As filed with the Securities and Exchange Commission on April 8, 1998
Registration No. 333-_____
Registration No. 333-_____-01
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-2
Registration Statement Under the Securities Act of 1933
-----------------------------
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<S> <C>
AMERICAN BANCORPORATION AMERICAN BANCORPORATION
CAPITAL TRUST I
(Exact name of Registrant as specified
in its charter) (Exact name of Registrant as specified
in its trust agreement)
OHIO DELAWARE
(State or other jurisdiction of (State or other jurisdiction of
incorporation or organization) incorporation or organization)
----------- -----------
31-0724349 55-6133241
(I.R.S. Employer (I.R.S. Employer
Identification No.) Identification No.)
</TABLE>
------------------------------
1025 Main Street, Suite 800
Wheeling, West Virginia 26003
(304) 233-5006
(Address, including zip code, and telephone number, including area code, of
registrant's principal executive offices)
------------------------------
Jeremy C. McCamic
Chairman of the Board and Chief Executive Officer
American Bancorporation
1025 Main Street, Suite 800
Wheeling, West Virginia 26003
(304) 233-5006
(Name, address, including zip code, and telephone number, including area
code, of agent for service)
----------------------------
Copies to:
Barry C. Maloney, Esq. Norman B. Antin, Esq.
Maloney & Knox Jeffrey D. Haas, Esq.
5225 Wisconsin Avenue, NW Elias, Matz, Tiernan & Herrick, L.L.P.
Washington, DC 20015-2014 734 15th Street, N.W.
Washington, D.C. 20005
----------------------------
Approximate date of commencement of proposed sale
to public: As soon as practicable after this
Registration Statement becomes effective.
If any of the securities being registered on this Form are to be
offered on a delayed or continuous basis pursuant to Rule 415 under the
Securities Act of 1933, check the following box. [ ]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, check the following box and
list the Securities Act registration statement number of the earlier effective
registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule
462(c) under the Securities Act, check the following box and list the Securities
Act registration statement number of the earlier effective registration
statement for the same offering. [ ]
If the registrant elects to deliver its latest annual report to
securities holders or a complete and legible facsimile thereof, pursuant to Item
11(a)(1) of this Form, check the following box. [X]
If delivery of the prospectus is expected to be made pursuant to Rule
434, check the following box. [ ]
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CALCULATION OF REGISTRATION FEE
===============================================================================================================================
Amount Proposed Proposed Amount of
Title of Each Class of Securities to be Maximum Maximum Registration
To be Registered Registered Offering Price Aggregate Fee(1)
Per Unit(1) Offering Price(1)
- -------------------------------------------------------------------------------------------------------------------------------
Trust Preferred Securities of American
<S> <C> <C> <C> <C>
Bancorporation Capital Trust I................. $12,650,000 100% $12,650,000 $3,731.75
- -------------------------------------------------------------------------------------------------------------------------------
Junior Subordinated Deferrable Interest
Debentures of American Bancorporation(2)....... $12,650,000 100% $12,650,000 N/A
- -------------------------------------------------------------------------------------------------------------------------------
American Bancorporation Guarantee with
respect to the Trust Preferred Securities...... N/A N/A N/A N/A
- -------------------------------------------------------------------------------------------------------------------------------
Total....................................... $12,650,000(4) 100% $12,650,000(4) $3,731.75
===============================================================================================================================
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(1) Estimated solely for the purpose of calculating the registration fee.
(2) No separate consideration will be received for the Junior Subordinated
Deferrable Interest Debentures of American Bancorporation (the "Junior
Subordinated Debentures") distributed upon any liquidation of American
Bancorporation Capital Trust I.
(3) No separate consideration will be received for the American Bancorporation
Guarantee.
(4) Such amount represents the liquidation amount of the American
Bancorporation Capital Trust I Trust Preferred Securities and the principal
amount of Junior Subordinated Debentures that may be distrusted to holders
of such Trust Preferred Securities upon any liquidation of American
Bancorporation Capital Trust I.
-------------------------
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE
AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE
A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THE REGISTRATION STATEMENT
SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF THE
SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION ACTING PURSUANT TO SAID SECTION 8(A)
MAY DETERMINE.
<PAGE>
PROSPECTUS
SUBJECT TO COMPLETION, DATED APRIL 8, 1998
$11,000,000
AMERICAN BANCORPORATION CAPITAL TRUST I
___% CUMULATIVE TRUST PREFERRED SECURITIES
(LIQUIDATION AMOUNT $10 PER PREFERRED SECURITY)
1,100,000 PREFERRED SECURITIES
FULLY AND UNCONDITIONALLY GUARANTEED, AS DESCRIBED HEREIN, BY
[LOGO]
AMERICAN BANCORPORATION
The ___% Cumulative Trust Preferred Securities (the "Preferred
Securities") offered hereby represent beneficial interests in American
Bancorporation Capital Trust I, a trust created under the laws of the State of
Delaware (the "Trust Issuer"). American Bancorporation, an Ohio corporation
("American Bancorporation" or the "Company"), will be the owner of all of the
beneficial interests represented by common securities of the Trust Issuer (the
"Common Securities" and, collectively with the Preferred Securities, the "Trust
Securities"). The Bank of New York is the Property Trustee of the Trust Issuer.
The Trust Issuer exists for the sole purpose of issuing the Trust Securities and
investing the proceeds from the sale thereof in ___% Junior Subordinated
Deferrable Interest Debentures (the "Junior Subordinated Debentures") to be
issued by the Company. The Junior Subordinated Debentures will mature on
__________, 2028 (the "Stated Maturity"). The Preferred Securities will have a
preference over the Common Securities under certain circumstances with respect
to cash distributions and amounts payable on liquidation, redemption or
otherwise. See "Description of the Preferred Securities--Subordination of the
Common Securities."
An application has been filed to list the Preferred Securities on the
Nasdaq Stock Market's National Market under the symbol "AMBCP." See "Risk
Factors--Absence of Prior Public Market for the Preferred Securities; Trading
Price and Tax Considerations."
----------------
SEE "RISK FACTORS" BEGINNING ON PAGE 18 FOR A DISCUSSION OF CERTAIN
FACTORS THAT SHOULD BE CONSIDERED BY PROSPECTIVE INVESTORS.
----------------
THE SECURITIES OFFERED HEREBY ARE NOT SAVINGS OR DEPOSIT ACCOUNTS AND ARE NOT
INSURED BY THE SAVINGS ASSOCIATION INSURANCE FUND OR THE BANK INSURANCE FUND OF
THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY OTHER GOVERNMENTAL AGENCY.
----------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
<PAGE>
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=============================================================================================================================
Price to Underwriting Proceeds to
Public Commission(1) Issuer (2)(3)
- -----------------------------------------------------------------------------------------------------------------------------
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Per Preferred Security............................... $10.00 (2) $10.00
- -----------------------------------------------------------------------------------------------------------------------------
Total(4)............................................. $11,000,000 (2) $11,000,000
=============================================================================================================================
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(1) The Trust Issuer and American Bancorporation have agreed to indemnify the
Underwriter against certain liabilities, including liabilities under the
Securities Act of 1933, as amended. See "Underwriting."
(2) In view of the fact that the proceeds of the sale of the Preferred
Securities will be invested in the Junior Subordinated Debentures of
American Bancorporation, American Bancorporation has agreed to pay the
Underwriter, as compensation for their arranging the investment of such
proceeds in the Junior Subordinated Debentures, $____ per Preferred
Security, or $_______ in the aggregate ($_______ in the aggregate if the
over-allotment option is exercised in full). See "Underwriting."
(3) Before deducting expenses payable by American Bancorporation, estimated to
be approximately $250,000.
(4) The Trust Issuer and American Bancorporation have granted the Underwriter a
30-day option to purchase up to 165,000 additional Preferred Securities on
the same terms and conditions set forth above solely to cover
over-allotments, if any. If this option is exercised in full, the total
Price to Public and Proceeds to Issuer will be $12,650,000. See
"Underwriting."
The Preferred Securities are offered by the Underwriter subject to
receipt and acceptance by it, prior sale and the Underwriter's right to reject
any order in whole or in part and to withdraw, cancel or modify the offer
without notice. It is expected that delivery of the Preferred Securities will be
made in book-entry form through the book-entry facilities of The Depository
Trust Company on or about _________, 1998 against payment therefor in
immediately available funds.
LEGG MASON WOOD WALKER
INCORPORATED
The date of this Prospectus is _________, 1998
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES
EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES
IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR
TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE.
<PAGE>
(continued from the previous page)
The Preferred Securities will be represented by one or more global
securities registered in the name of a nominee of The Depository Trust Company,
as depository ("DTC"). Beneficial interests in the global securities will be
shown on, and transfer thereof will be effected only through, records maintained
by DTC and its participants. Except as described under "Description of Preferred
Securities," Preferred Securities in definitive form will not be issued and
owners of beneficial interests in the global securities will not be considered
holders of the Preferred Securities. Settlement for the Preferred Securities
will be made in immediately available funds. The Preferred Securities will trade
in DTC's Same-Day Funds Settlement System, and secondary market trading activity
for the Preferred Securities will therefore settle in immediately available
funds.
Holders of the Preferred Securities will be entitled to receive
preferential cumulative cash distributions accumulating from the date of
original issuance and payable quarterly in arrears on March 1, June 1, September
1 and December 1 of each year, commencing _______, 1998, at the annual rate of
___% of the Liquidation Amount (as defined herein) of $10 per Preferred Security
("Distributions"). Subject to certain exceptions, American Bancorporation has
the right to defer payment of interest on the Junior Subordinated Debentures at
any time or from time to time for a period not exceeding 20 consecutive quarters
with respect to each deferral period (each, an "Extension Period"), provided
that no Extension Period may extend beyond the Stated Maturity of the Junior
Subordinated Debentures. Upon the termination of any such Extension Period and
the payment of all interest then accrued and unpaid (together with interest
thereon at the rate of ___%, compounded quarterly, to the extent permitted by
applicable law), American Bancorporation may elect to begin a new Extension
Period subject to the requirements set forth herein. If interest payments on the
Junior Subordinated Debentures are so deferred, Distributions on the Preferred
Securities will also be deferred, and American Bancorporation will not be
permitted, subject to certain exceptions described herein, to declare or pay any
cash distributions with respect to the capital stock of American Bancorporation
or debt securities of American Bancorporation that rank pari passu with or
junior to the Junior Subordinated Debentures.
During an Extension Period, interest on the Junior Subordinated
Debentures would continue to accrue (and the amount of Distributions to which
holders of the Preferred Securities are entitled would accumulate) at the rate
of ___% per annum, compounded quarterly, and holders of the Preferred Securities
would be required to include interest income in their gross income for United
States federal income tax purposes in advance of receipt of the cash
distributions with respect to such deferred interest payments. American
Bancorporation believes that the mere existence of its right to defer interest
payments should not cause the Preferred Securities to be issued with original
issue discount for federal income tax purposes. However, it is possible that the
Internal Revenue Service ("IRS") could take the position that the likelihood of
deferral was not a remote contingency within the meaning of applicable Treasury
Regulations. See "Description of the Junior Subordinated Debentures-Right to
Defer Interest Payment Obligation" and "Certain Federal Income Tax
Consequences--Interest Income and Original Issue Discount."
i
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American Bancorporation and the Trust Issuer believe that, taken
together, the obligations of American Bancorporation under the Guarantee, the
Trust Agreement, the Junior Subordinated Debentures, the Indenture and the
Expense Agreement (each as defined herein), constitute in the aggregate, a full,
irrevocable and unconditional guarantee, on a subordinated basis, of all of the
Trust Issuer's obligations under the Preferred Securities. See "Relationship
Among the Preferred Securities, the Junior Subordinated Debentures, the Expense
Agreement and the Guarantee--Full and Unconditional Guarantee." The Guarantee of
American Bancorporation (the "Guarantee") guarantees the payment of
Distributions and payments on liquidation or redemption of the Preferred
Securities, but only in each case to the extent of funds held by the Trust
Issuer, as described herein. See "Description of the Guarantee." If American
Bancorporation does not make interest payments on the Junior Subordinated
Debentures held by the Trust Issuer, the Trust Issuer will have insufficient
funds to pay Distributions on the Preferred Securities. The Guarantee does not
cover payment of Distributions when the Trust Issuer does not have sufficient
funds to pay such Distributions. In such event, a holder of the Preferred
Securities may institute a legal proceeding directly against American
Bancorporation to enforce payment of amounts equal to such Distributions to such
holder. See "Description of the Junior Subordinated Debentures-Enforcement of
Certain Rights by Holders of the Preferred Securities."
The Preferred Securities are subject to mandatory redemption, in whole
or in part, upon repayment of the Junior Subordinated Debentures at their Stated
Maturity or their earlier redemption. Subject to regulatory approval, if then
required under applicable capital guidelines or regulatory policies, the Junior
Subordinated Debentures are redeemable prior to their Stated Maturity at the
option of the Company (i) on or after ______ __, 2003, in whole at any time or
in part from time to time, or (ii) at any time, in whole (but not in part), upon
the occurrence and continuation of a Tax Event, an Investment Company Event or a
Capital Treatment Event (each as defined herein) at a redemption price (the
"Redemption Price") equal to the accrued and unpaid interest on the Junior
Subordinated Debentures so redeemed to the date fixed for redemption plus 100%
of the principal amount thereof. See "Description of the Junior Subordinated
Debentures-Redemption or Exchange."
The obligations of American Bancorporation under the Guarantee and the
Junior Subordinated Debentures will be unsecured and are subordinate and junior
in right of payment to all Senior Indebtedness (as defined in "Description of
the Junior Subordinated Debentures--- Subordination") of American
Bancorporation. At December 31, 1997, American Bancorporation had no outstanding
Senior Indebtedness. There is no limitation on the amount of Senior Indebtedness
which American Bancorporation may issue. American Bancorporation may from time
to time incur indebtedness constituting Senior Indebtedness. See "Description of
the Junior Subordinated Debentures-Subordination."
American Bancorporation, as the holder of the Common Securities, will
have the right at any time to dissolve the Trust Issuer. The ability of American
Bancorporation to do so may be subject to American Bancorporation's prior
receipt of regulatory approval. In the event of the dissolution of the Trust
Issuer, after satisfaction of liabilities to creditors of the Trust Issuer as
required by applicable law, the holders of the Preferred Securities will be
entitled to receive a
ii
<PAGE>
Liquidation Amount of $10 per Preferred Security plus accumulated and unpaid
Distributions thereon to the date of payment, which may be in the form of a
distribution of such amount in Junior Subordinated Debentures, subject to
certain exceptions. See "Description of the Preferred Securities--Liquidation
Distribution upon Dissolution."
CERTAIN PERSONS PARTICIPATING IN THIS OFFERING MAY ENGAGE IN
TRANSACTIONS THAT STABILIZE, MAINTAIN, OR OTHERWISE AFFECT THE PRICE OF THE
PREFERRED SECURITIES OFFERED HEREBY, INCLUDING OVER-ALLOTMENT, STABILIZING
TRANSACTIONS, SYNDICATE SHORT COVERING TRANSACTIONS AND PENALTY BIDS. ANY OF THE
FOREGOING TRANSACTIONS, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME WITHOUT
NOTICE. FOR A DESCRIPTION OF THESE ACTIVITIES, SEE "UNDERWRITING."
iii
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AVAILABLE INFORMATION
The Company is subject to the informational requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and in
accordance therewith, files reports, proxy statements and other information with
the Commission. Such reports, proxy statements and other information can be
inspected and copied at the public reference facilities of the Commission at
Room 1024, 450 Fifth Street, N.W., Washington, D.C. 20549 and at the regional
offices of the Commission located at 7 World Trade Center, 13th Floor, Suite
1300, New York, New York 10048 and Suite 1400, Citicorp Center, 14th Floor, 500
West Madison Street, Chicago, Illinois 60661. Copies of such material can also
be obtained at prescribed rates by writing to the Public Reference Section of
the Commission at 450 Fifth Street, N.W., Washington, D.C. 20549. Such material
may also be accessed electronically by means of the Commission's home page on
the Internet at http://www.sec.gov. The Corporation's common stock is traded on
the Nasdaq National Market. Such reports, proxy statements and other information
concerning the Corporation also may be inspected at the office of the National
Association of Securities Dealers, Inc., 1735 K Street, N.W., Washington D.C.
20006.
The Company and the Trust Issuer have filed with the Commission a
Registration Statement on Form S-2 (together with all amendments thereto, the
"Registration Statement"), of which this Prospectus is a part, under the
Securities Act of 1933, as amended (the "Securities Act"), with respect to the
Preferred Securities, the Junior Subordinated Debentures and the Guarantee. This
Prospectus does not contain all of the information set forth in the Registration
Statement, certain portions of which have been omitted as permitted by the rules
and regulations of the Commission. For further information with respect to the
Company, the Trust Issuer, the Preferred Securities and the Junior Subordinated
Debentures, reference is made to the Registration Statement, including the
exhibits thereto. Any statements contained herein concerning the provisions of
any document filed as an exhibit to the Registration Statement are not
necessarily complete, and, in each instance, reference is made to the copy of
such document so filed for a more complete description of the matter involved.
Each such statement is qualified in its entirely by such reference. The
Registration Statement may be inspected without charge at the principal office
of the Commission in Washington, D.C., and copies of all or part of it may be
obtained from the Commission upon payment of the prescribed fees.
No separate financial statements of the Trust Issuer have been included
herein. The Company does not consider that such financial statements would be
material to holders of Preferred Securities because (i) all of the voting
securities of the Trust Issuer will be owned by the Company, a reporting company
under the Exchange Act, (ii) the Trust Issuer has no independent operations but
exists for the sole purpose of issuing securities representing undivided
beneficial interests in the assets of the Trust Issuer and investing the
proceeds thereof in Junior Subordinated Debentures issued by the Company, and
(iii) the obligations of the Company described herein to provide certain
indemnities in respect of and be responsible for certain costs, expenses, debts
and liabilities of the Trust Issuer under the Indenture and pursuant to the
Trust Agreement, the guarantee issued by the Company with respect to the
Preferred Securities, the
1
<PAGE>
Junior Subordinated Debentures purchased by the Trust Issuer, the related
Indenture and the Expense Agreement, taken together, constitute, in the belief
of the Company and the Trust Issuer full and unconditional guarantee of payments
due on the Preferred Securities. See "Description of the Junior Subordinated
Debentures" and "Description of the Guarantee."
The Trust Issuer is not currently subject to the information reporting
requirements of the Exchange Act and the Company does not expect that the Trust
Issuer will file reports, proxy statements and other information under the
Exchange Act with the Commission.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed by the Corporation with the Commission
are incorporated into this Prospectus by reference:
1. The Corporation's Annual Report on Form 10-K for the year ended
December 31, 1997.
Any statement contained herein or in a document incorporated or deemed
to be incorporated by reference herein shall be deemed to be modified or
superseded for purposes of this Prospectus to the extent that a statement
contained herein or in any other subsequently filed document which also is or is
deemed to be incorporated by reference herein modifies or supersedes such
statement. Any statement so modified or superseded shall not be deemed, except
as so modified or superseded, to constitute a part of this Prospectus.
As used herein, the terms "Prospectus" and "herein" mean this
Prospectus, including the documents incorporated or deemed to be incorporated
herein by reference, as the same may be amended, supplemented or otherwise
modified from time to time. Statements contained in this Prospectus as to the
contents of any contract or other document referred to herein do not purport to
be complete, and where reference is made to the particular provisions of such
contract or other documents, such provisions are qualified in all respects by
reference to all of the provisions of such contract or other document.
The Corporation will provide without charge to any person to whom this
Prospectus is delivered, on the written or oral request of such person, a copy
of any or all of the foregoing documents incorporated by reference herein (other
than exhibits unless such exhibits are specifically incorporated by reference in
such documents). Requests for such documents should be directed to: American
Bancorporation, 1025 Main Street, Suite 800, Wheeling, West Virginia 26003,
Attention: Shareholder Relations (telephone (304) 233-5006).
2
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[MAP INDICATING
AMERICAN BANCORPORATION'S BRANCH OFFICES]
3
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SUMMARY
THE FOLLOWING SUMMARY IS QUALIFIED IN ITS ENTIRETY BY THE MORE DETAILED
INFORMATION APPEARING ELSEWHERE IN THIS PROSPECTUS. UNLESS OTHERWISE INDICATED,
THE INFORMATION IN THIS PROSPECTUS ASSUMES THAT THE UNDERWRITERS' OVER-ALLOTMENT
OPTION WILL NOT BE EXERCISED.
AMERICAN BANCORPORATION
American Bancorporation (the "Registrant" or the "Company") is a bank
holding company, headquartered in Wheeling, West Virginia, which through its
subsidiaries provides commercial and mortgage banking services to customers in
central and eastern Ohio and northern West Virginia. The Company's principal
subsidiary, Wheeling National Bank ("WNB" or the "Bank"), headquartered in St.
Clairsville, Ohio, is a full-service commercial bank operating through 20
offices. As of December 31, 1997, the Company had consolidated total assets of
$484.6 million, deposits of $355.7 million and stockholders' equity of $33.7
million.
The Company, registered under the Bank Holding Company Act of 1956, as
amended ("BHCA"), was incorporated under the laws of the State of Ohio in 1966.
WNB, a national banking association organized in 1978, was acquired by the
Company in 1988. In 1996, the Company merged its other former banking
subsidiary, Columbus National Bank, into Wheeling National Bank, under the
charter of WNB.
Through WNB, the Company provides a full range of commercial banking
services to retail customers and small to medium-sized businesses in its market
area. In eastern Ohio and northern West Virginia the Company focuses on local
customer needs. In the Columbus, Ohio area, the Company focuses its marketing
efforts on local businesses, whose needs are not being served effectively by
larger institutions, including SBA guaranteed commercial loans.
The banking services the Company offers its customers include checking,
savings, time and money market accounts, personal, commercial, construction and
real estate loans, individual retirement accounts, safe deposit boxes, wire
transfers, credit cards and debit cards, among other standard banking products
and services.
In addition to its banking activities, the Company originates and
services mortgage loans through American Mortgages, Inc. ("AMI"), a wholly-owned
subsidiary. AMI owns 51% of Premier Mortgage, Ltd. ("Premier"), located in
Columbus, Ohio, a joint venture which originates residential mortgage loans. The
Company also operates three additional subsidiaries which provide data
processing equipment, real estate leasing and transfer agent services for the
Company, the Bank and AMI.
4
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The Company's lending activities include real estate, commercial and
consumer installment lending. At December 31, 1997 the total loan portfolio
amounted to $286.7 million or 59.2% of total consolidated assets. At December
31, 1997 real estate mortgage loans totalled $144.2 million, commercial loans
totalled $93.3 million and consumer installment loans totalled $49.2 million.
Total loans increased by $15.2 million or 5.6% between December 31, 1996 and
December 31, 1997 as commercial loans increased $8.7 million or 10.3% and real
estate mortgage loans increased $7.7 million or 5.6 % while consumer installment
loans decreased $1.2 million or 2.3%.
The Company also invests its funds in U.S. Government and agency
securities including mortgage-backed securities and collateralized mortgage
obligations, as well as municipal, equity securities and short-term investments.
At December 31, 1997 investment securities and other short-term investments were
$171.6 million or 35.4% of total consolidated assets as compared to $161.3
million or 35.0% at December 31, 1996.
The Company offers a variety of traditional deposit products to its
customers. At December 31, 1997 deposits totalled $355.7 million compared to
$319.8 million at December 31, 1996. At December 31, 1997 noninterest bearing
demand deposits totalled $33.5 million, NOW money market and savings deposits
totalled $119.5 million and time deposits totalled $202.7 million.
The Company also maintains a leveraging strategy designed to enhance
its return on equity and earnings. The Company invests in U.S. Government and
agency obligations at a positive interest rate spread on the funding
obligations, which has been Federal Home Loan Bank ("FHLB") advances. At
December 31, 1997 the Company held total FHLB advances outstanding of $74.0
million.
The Company derives its income principally from interest earned on
loans, securities and other investments and to a lesser extent, from fees
received in connection with the origination of loans and for other services. The
Company's primary expenses are interest expense on deposits and borrowings and
other operating expenses.
5
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The Company's executive office is located at 1025 Main Street, Suite
800, Wheeling, West Virginia, 26003 and its telephone number is (304) 233-5006.
THE TRUST ISSUER
The Trust Issuer is a statutory business trust created under Delaware
law pursuant to (i) the Trust Agreement executed by the Company, as depositor,
The Bank of New York, as Property Trustee, The Bank of New York (Delaware), as
Delaware Trustee, and the Administrative Trustees named therein and (ii) the
filing of a certificate of trust with the Delaware Secretary of State on March
11, 1998. The trust agreement will be amended and restated in its entirety (as
so amended, the "Trust Agreement"). All of the Common Securities will be owned
by the Company. The Company will acquire Common Securities in an aggregate
Liquidation Amount equal to 3% of the total capital of the Trust Issuer. The
Trust Issuer exists for the exclusive purposes of (i) issuing and selling the
Trust Securities, (ii) using the proceeds from the sale of the Trust Securities
to acquire Junior Subordinated Debentures issued by the Company and (iii)
engaging in only those other activities necessary, advisable or incidental
thereto (such as registering the transfer of the Trust Securities). Accordingly,
the Junior Subordinated Debentures will be the sole assets of the Trust Issuer,
and payments under the Junior Subordinated Debentures will be the sole revenue
of the Trust Issuer. The principal executive office of the Trust Issuer is 1025
Main Street, Suite 800, Wheeling, West Virginia 26003 and its telephone number
is (304) 233-5006.
THE OFFERING
THE TRUST ISSUER................ American Bancorporation Capital Trust I, a
Delaware statutory business trust (the "Trust
Issuer"). The sole assets of the Trust Issuer
will be the Junior Subordinated Debentures.
SECURITIES OFFERED.............. 1,100,000 shares of __% Cumulative Trust
Preferred Securities (the "Preferred
Securities"), evidencing preferred undivided
beneficial interests in the assets of the
Trust Issuer, which will consist only of the
Junior Subordinated Debentures.
6
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OFFERING PRICE.................. $10 per Preferred Security (Liquidation Amount
$10).
DISTRIBUTIONS................... Holders of the Preferred Securities will be
entitled to receive cumulative cash
Distributions at an annual rate of __% of the
Liquidation Amount of $10 per Preferred
Security, accumulating from the date of
original issuance and payable quarterly in
arrears on March 1, June 1, September 1 and
December 1 of each year, commencing on
_________, 1998. The distribution rate and the
distribution and other payment dates for the
Preferred Securities will correspond to the
interest rate and interest and other payment
dates on the Junior Subordinated Debentures.
See "Description of the Preferred Securities."
JUNIOR SUBORDINATED DEBENTURES.. The Trust Issuer will invest the proceeds from
the issuance of the Trust Securities in an
equivalent amount of the Junior Subordinated
Debentures. The Junior Subordinated Debentures
will mature on ________, 2028. The Junior
Subordinated Debentures will rank subordinate
and junior in right of payment to all Senior
Indebtedness of American Bancorporation. At
December 31, 1997, American Bancorporation had
no outstanding Senior Indebtedness. There is
no limitation on the amount of Senior
Indebtedness, or Subordinated Debt (as defined
in "Description of Junior Subordinated
Debentures- Subordination") which is pari
passu with the Junior Subordinated Debentures,
which American Bancorporation may issue.
American Bancorporation may from time to time,
incur indebtedness constituting Senior
Indebtedness. In addition, because American
Bancorporation is a holding company, American
Bancorporation's obligations under the Junior
Subordinated Debentures will effectively be
subordinated to all existing and future
liabilities and obligations of its
subsidiaries, including the Bank. See "Risk
Factors--Subordination of the Guarantee and
the Junior Subordinated Debentures," "Risk
Factors--Source of Payments to Holders of
Preferred Securities" and "Description of the
Junior Subordinated Debentures --
Subordination."
7
<PAGE>
GUARANTEE....................... Payments of Distributions out of funds held by
the Trust Issuer, and payments on liquidation
of the Trust Issuer or the redemption of the
Preferred Securities, are guaranteed by
American Bancorporation to the extent the
Trust Issuer has funds available therefor.
American Bancorporation and the Trust Issuer
believe that, taken together, the obligations
of American Bancorporation under the
Guarantee, the Trust Agreement, the Junior
Subordinated Debentures, the Indenture and the
Expense Agreement, constitute, in the
aggregate, a full and unconditional guarantee,
on a subordinated basis, of all of the Trust
Issuer's obligations under the Preferred
Securities. See "Description of the Guarantee"
and "Relationship Among the Preferred
Securities, the Junior Subordinated
Debentures, the Expense Agreement and the
Guarantee." The obligations of American
Bancorporation under the Guarantee are
subordinate and junior in right of payment to
all Senior Indebtedness of American
Bancorporation. See "Risk Factors--
Subordination of the Guarantee and the Junior
Subordinated Debentures" and "Description of
the Guarantee."
RIGHT TO DEFER INTEREST PAYMENTS So long as no event of default under the
Indenture has occurred and is continuing,
American Bancorporation has the right under
the Indenture at any time during the term of
the Junior Subordinated Debentures to defer
the payment of interest at any time or from
time to time for a period not exceeding 20
consecutive quarters with respect to each
Extension Period, provided that no Extension
Period may extend beyond the Stated Maturity
of the Junior Subordinated Debentures. At the
end of such Extension Period, American
Bancorporation must pay all interest then
accrued and unpaid (together with interest
thereon at the annual rate of ___%, compounded
quarterly, to the extent permitted by
applicable law). During an Extension Period,
interest will continue to accrue and holders
of the Junior Subordinated Debentures (or
holders of the Preferred Securities, while
outstanding) will be required to accrue
interest income for United States federal
income tax purposes in advance of receipt of
payment of such deferred interest. See
"Certain Federal Income Tax
Consequences--Interest Income and Original
Issue Discount".
8
<PAGE>
During any such Extension Period, American
Bancorporation may not, and may not permit any
subsidiary of American Bancorporation to, (i)
declare or pay any dividends or distributions
on, or redeem, purchase, acquire or make a
liquidation payment with respect to, any of
American Bancorporation's capital stock (other
than (a) the reclassification of any class of
American Bancorporation's capital stock into
another class of capital stock, (b) dividends
or distributions payable in common stock of
American Bancorporation, (c) any declaration
of a dividend in connection with the
implementation of a stockholders' rights plan,
the issuance of stock under any such plan in
the future or the redemption or repurchase of
any such rights pursuant thereto, (d) payments
under the Guarantee and (e) purchases of
common stock related to the issuance of common
stock or rights under any of American
Bancorporation's benefit plans for its
directors, officers or employees), (ii) make
any payment of principal, interest or premium,
if any, on, or repay, repurchase or redeem,
any debt securities of American Bancorporation
that rank pari passu with or junior in right
of payment to the Junior Subordinated
Debentures, or (iii) make any guarantee
payments with respect to any guarantee by
American Bancorporation of the debt securities
of any subsidiary of American Bancorporation
if such guarantee ranks pari passu with or
junior in right of payment to the Junior
Subordinated Debentures other than payments
pursuant to the Guarantee. Prior to the
termination of any such Extension Period,
American Bancorporation may further defer the
payment of interest on the Junior Subordinated
Debentures, provided that no Extension Period
may exceed 20 consecutive quarters or extend
beyond the Stated Maturity of the Junior
Subordinated Debentures. There is no
limitation on the number of times that
American Bancorporation may elect to begin an
Extension Period. See "Description of the
Junior Subordinated Debentures--Right to Defer
Interest Payment Obligation" and "Certain
Federal Income Tax Consequences--Interest
Income and Original Issue Discount."
American Bancorporation has no current
intention of exercising its right to defer
payments of interest by
9
<PAGE>
extending the interest payment period on the
Junior Subordinated Debentures. However,
should American Bancorporation elect to
exercise such right in the future, the market
price of the Preferred Securities is likely to
be adversely affected. As a result of the
existence of American Bancorporation's right
to defer interest payments, the market price
of the Preferred Securities may be more
volatile than the market prices of other
similar securities that do not provide for
such optional deferrals.
REDEMPTION...................... The Junior Subordinated Debentures are subject
to redemption prior to their Stated Maturity
at the option of American Bancorporation (i)
on or after ________, 2003, in whole at any
time or in part from time to time, or (ii) at
any time, in whole (but not in part), within
180 days following the occurrence and
continuation of a Tax Event, an Investment
Company Event or a Capital Treatment Event
(each as defined herein), in each case at a
redemption price equal to 100% of the
principal amount of the Junior Subordinated
Debentures so redeemed, together with any
accrued and unpaid interest to the date fixed
for redemption.
If the Junior Subordinated Debentures are
redeemed prior to their Stated Maturity, the
Trust Issuer must apply the proceeds of such
redemption to redeem a Like Amount (as defined
herein) of the Preferred Securities and the
Common Securities. The Preferred Securities
will be redeemed upon repayment of the Junior
Subordinated Debentures at their Stated
Maturity. See "Description of the Preferred
Securities-- Redemption."
DISTRIBUTION OF THE JUNIOR
SUBORDINATED DEBENTURES UPON
LIQUIDATION OF THE TRUST ISSUER American Bancorporation will have the right at
any time to dissolve the Trust Issuer and,
after satisfaction of creditors of the Trust
Issuer, if any, as provided by applicable law,
cause the Junior Subordinated Debentures to be
distributed to the holders of the Preferred
Securities and the Common Securities in
exchange therefor upon liquidation of the
Trust Issuer. The ability of American
Bancorporation to do so may
10
<PAGE>
be subject to American Bancorporation's prior
receipt of regulatory approval.
In the event of the liquidation of the Trust
Issuer, after satisfaction of the claims of
creditors of the Trust Issuer, if any, as
provided by applicable law, the holders of the
Preferred Securities will be entitled to
receive a Liquidation Amount of $10 per
Preferred Security plus accumulated and unpaid
Distributions thereon to the date of payment,
which may be in the form of a distribution of
a Like Amount (as defined herein) of the
Junior Subordinated Debentures, subject to
certain exceptions as described herein. See
"Description of the Preferred
Securities--Liquidation of the Trust Issuer
and Distribution of the Junior Subordinated
Debentures to Holders."
VOTING RIGHTS................... Except in limited circumstances, the holders
of the Preferred Securities will have no
voting rights. See "Description of the
Preferred Securities--Voting Rights; Amendment
of Trust Agreement."
USE OF PROCEEDS................. All of the proceeds from the sale of the
Preferred Securities will be used by the Trust
Issuer to purchase Junior Subordinated
Debentures. American Bancorporation intends
that the net proceeds from the sale of such
Junior Subordinated Debentures will be used
for general corporate purposes, including, but
not limited to, acquisitions by either the
Company or the Bank (although there presently
exist no agreements or understandings with
respect to any such acquisition), capital
contributions to the Bank to support growth
and for working capital, and the possible
repurchase of shares of American
Bancorporation's common stock, subject to
acceptable market conditions.
RISK FACTORS.................... An investment in the Preferred Securities
involves substantial risks that should be
considered by prospective purchasers. In
addition, because holders of the Preferred
Securities may receive Junior Subordinated
Debentures on dissolution of the Trust Issuer,
and because payments on the Junior
Subordinated Debentures are the sole source of
funds for Distributions on and redemptions of
the Preferred Securities, prospective
purchasers of the Preferred
11
<PAGE>
Securities are also making an investment
decision with regard to the Junior
Subordinated Debentures and should carefully
review all of the information regarding the
Junior Subordinated Debentures contained
herein. See "Risk Factors" and "Description of
the Junior Subordinated Debentures."
NASDAQ NATIONAL MARKET
SYMBOL........................ An application has been filed to list the
Preferred Securities on the Nasdaq Stock
Market's National Market under the symbol
"AMBCP."
ERISA CONSIDERATIONS............ For a discussion of certain restrictions on
purchases, see "ERISA Considerations."
12
<PAGE>
SELECTED CONSOLIDATED FINANCIAL AND OTHER DATA OF THE COMPANY
The selected consolidated financial and other data of the Company set
forth below does not purport to be complete and should be read in conjunction
with, and is qualified in its entirety by, the more detailed information,
included in the Corporation's Annual Report on Form 10-K for the year ended
December 31, 1997. See "Incorporation of Certain Documents by Reference."
<TABLE>
<CAPTION>
As of or For the
Year Ended December 31,
--------------------------------------------------------------------------------
1997 1996 1995 1994 1993
------------ ------------ ------------ ------------ ------------
(Dollars in Thousands except per share amounts)
SELECTED FINANCIAL AND OTHER DATA:
<S> <C> <C> <C> <C> <C>
Total assets $484,606 $461,632 $353,995 $338,116 $276,390
Investment securities 169,176 143,474 68,015 78,189 94,103
Loans receivable, net 286,691 271,450 250,372 228,866 150,523
Cash and cash equivalents 13,443 29,420 22,357 14,628 21,833
Deposits 355,734 319,811 292,665 292,341 248,040
FHLB advances and other short term
borrowings 87,574 104,096 27,523 13,398 1,609
Long-term debt 1,425 938 1,047 2,000 0
Stockholders' equity 33,694 30,423 28,012 26,193 24,158
Non-performing assets(1) 2,894 2,570 2,640 3,272 4,197
Full-service offices at end of
period 20 20 19 19 17
SELECTED OPERATING DATA:
Interest income $35,539 $29,885 $26,496 $20,135 $20,570
Interest expense 18,278 13,802 11,171 7,189 8,009
------ ------- ------- ------- -------
Net interest income 17,261 16,083 15,325 12,946 12,561
Provision for loan losses 0 0 105 215 844
------ ------- ------- ------- -------
Net interest income after
provision for loan losses 17,261 16,083 15,220 12,731 11,717
Net gain (losses) on sale of securities 34 (1) 3 3 219
Other non-interest income 2,892 2,393 1,677 1,059 1,230
Special SAIF assessment(2) 0 245 0 0 0
Other noninterest expenses 13,101 12,462 12,090 11,215 10,397
------ ------- ------- ------- -------
Income before income taxes 7,086 5,768 4,810 2,578 2,769
Income taxes 2,577 2,102 1,758 882 999
------ ------- ------- ------- -------
Net income $ 4,509 $ 3,666(2) $ 3,052 $ 1,696 $ 1,770
====== ======= ======= ======= =======
PER BASIC COMMON SHARE:
Net income $ 1.44 $ 1.17(2) $ 0.98 $ 0.56 $ 0.59
Cash dividends 0.50 0.45 0.35 0.25 0.25
Book value 10.77 9.72 8.95 8.37 8.02
SELECTED OPERATING RATIOS:
Average yield earned on
interest-earning assets 8.09% 7.99% 8.18% 7.65% 7.99%
Average rate paid on interest-
bearing liabilities 4.62 4.14 3.93 3.15 3.51
Average interest rate spread(4) 3.47 3.85 4.25 4.50 4.48
Net interest margin(4) 3.93 4.30 4.73 4.92 4.88
Ratio of average interest-earning assets
to average interest-bearing liabilities 110.95 112.06 113.87 115.36 112.84
Net interest income to
operating expenses 1.32 1.27 1.27 1.15 1.21
Operating expenses as a
percent of average assets 2.80 3.17(2) 3.47 3.94 3.73
Return on average assets 0.96 0.91(2) 0.88 0.60 0.64
Return on average equity 14.15 12.62(2) 11.20 6.73 7.45
Ratio of average equity to
average assets 6.81 7.25 7.82 8.84 8.53
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
ASSET QUALITY RATIOS(3):
Non-performing loans as a percent
of total loans 0.93% 0.72% 0.82% 1.13% 2.32%
Non-performing assets as a percent
of total assets 0.60 0.56 0.75 0.97 1.52
Allowance for loan losses as a
percent of total loans 1.15 1.31 1.54 1.63 2.35
Allowance for loan losses as a
percent of non-performing loans 123.55 181.56 186.63 144.29 101.32
BANK CAPITAL RATIOS(3):
Tier 1 risk-based capital ratio 11.21% 10.51% 11.66% 11.48% 14.53%
Total risk-based capital ratio 12.39 11.76 12.91 12.74 15.79
Tier 1 leverage capital ratio 6.53 6.49 7.47 6.92 8.30
(Footnotes on following page)
</TABLE>
13
<PAGE>
(1) Non-performing assets consist of non-performing loans and real estate owned
("REO"). Non-performing loans consist of non-accrual loans and accruing
loans 90 days or more overdue, while REO consists of real estate acquired
through foreclosure and former banking facilities.
(2) Without giving effect to the one-time special Savings Association Insurance
fund ("SAIF") assessment of $245,000 or $147,000 after tax ($.05 basic
share) incurred in the September 1996 quarter to recapitalize the SAIF of
the Federal Deposit Insurance Corporation ("FDIC"), net income and basic
net income per share would have been $3,813,000 and $1.22, respectively,
and operating expenses as a percent of average assets, return on average
assets and return on average equity would have been 3.11%, 0.95% and
13.13%, respectively.
(3) Asset Quality Ratios and Capital Ratios are end of period ratios. With the
exception of end of period ratios, all ratios are based on month end
average balances during the indicated periods.
(4) Interest rate spread represents the difference between the weighted average
yield on average interest-earning assets and the weighted average cost of
average interest-bearing liabilities, and net interest margin represents
net interest income as a percent of average interest-earning assets.
14
<PAGE>
RISK FACTORS
An investment in the Preferred Securities involves a high degree of
risk. Prospective investors should carefully consider, together with the other
information contained in this Prospectus, the following factors in evaluating
the Company, its business and the Trust Issuer before purchasing the Preferred
Securities offered hereby. Prospective investors should note, in particular,
that this Prospectus contains forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933, as amended (the "Securities Act"),
and Section 21E of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), that involve substantial risks and uncertainties. When used in
this Prospectus, the words "anticipate," "believe," "estimate," "may," "intend"
and "expect" and similar expressions identify certain of such forward-looking
statements. Actual results, performance or achievements could differ materially
from those contemplated, expressed or implied by the forward-looking statements
contained herein. The considerations listed below represent certain important
factors the Company believes could cause such results to differ. These
considerations are not intended to represent a complete list of the general or
specific risks that may affect the Company and the Trust Issuer. It should be
recognized that other risks, including general economic factors and expansion
strategies, may be significant, presently or in the future, and the risks set
forth below may affect American Bancorporation and the Trust Issuer to a greater
extent than indicated.
RISK FACTORS RELATING TO THE OFFERING
SUBORDINATION OF THE GUARANTEE AND THE JUNIOR SUBORDINATED DEBENTURES
The obligations of American Bancorporation under the Guarantee issued
by American Bancorporation for the benefit of the holders of the Preferred
Securities and under the Junior Subordinated Debentures issued to the Trust
Issuer will be unsecured and will rank subordinate and junior in right of
payment to all Senior Indebtedness of American Bancorporation. At December 31,
1997, American Bancorporation had no outstanding Senior Indebtedness. There is
no limitation on the amount of Senior Indebtedness, or subordinated debt which
is pari passu with the Junior Subordinated Debentures, which American
Bancorporation may issue. Because American Bancorporation is a holding company,
the right of American Bancorporation to participate in any distribution of
assets of any subsidiary, including the Bank, upon such subsidiary's liquidation
or reorganization or otherwise (and thus the ability of holders of the Preferred
Securities to benefit indirectly from such distribution), is subject to the
prior claims of creditors of that subsidiary (including depositors in the Bank),
except to the extent that American Bancorporation may itself be recognized as a
creditor of that subsidiary. If American Bancorporation is a creditor of a
subsidiary, the claims of American Bancorporation would be subject to any prior
security interest in the assets of the subsidiary and any indebtedness of the
subsidiary senior to that of American Bancorporation. Accordingly, the Junior
Subordinated Debentures and the Guarantee will be effectively subordinated to
all existing and future liabilities of American Bancorporation's subsidiaries,
including the Bank. At December 31, 1997, the Company had aggregate liabilities
of $450.9 million (including $355.7 million in deposits). Only the capital stock
of American Bancorporation is currently junior in right of payment to the Junior
15
<PAGE>
Subordinated Debentures to be issued to the Trust Issuer. Holders of the Junior
Subordinated Debentures will be able to look only to the assets of American
Bancorporation for payments on the Junior Subordinated Debentures. None of the
Indenture, the Guarantee, the Expense Agreement or the Trust Agreement places
any limitation on the amount of secured or unsecured debt, including Senior
Indebtedness, that may be incurred by American Bancorporation. American
Bancorporation may, from time to time, incur indebtedness constituting Senior
Indebtedness. See "Description of the Guarantee--Status of the Guarantee" and
"Description of the Junior Subordinated Debentures--Subordination."
SOURCE OF PAYMENTS TO HOLDERS OF PREFERRED SECURITIES
As a bank holding company, American Bancorporation conducts its
operations principally through its subsidiaries and, therefore, its principal
source of cash, other than its investing and financing activities, is the
receipt of dividends from the Bank. Since American Bancorporation is without
significant assets other than the capital stock of the Bank, the ability of
American Bancorporation to pay interest on the principal of the Junior
Subordinated Debentures to the Trust Issuer (and consequently, the Trust
Issuer's ability to pay Distributions on the Preferred Securities and American
Bancorporation's ability to pay its obligations under the Guarantee) will be
dependent on the ability of the Bank to pay dividends to American Bancorporation
in amounts sufficient to service American Bancorporation's obligations. American
Bancorporation may become obligated to make other payments with respect to
securities issued by American Bancorporation in the future which are pari passu
or have a preference over the Junior Subordinated Debentures issued to the Trust
Issuer with respect to the payment of principal, interest or dividends. There is
no restriction on the ability of American Bancorporation to issue, or
limitations on the amount of securities which American Bancorporation may issue,
which are pari passu or have a preference over the Junior Subordinated
Debentures issued to the Trust Issuer, nor is there any restriction on the
ability of the Bank to issue additional capital stock or incur additional
indebtedness.
There are regulatory limitations on the payment of dividends directly
or indirectly to the Company from the Bank. As of December 31, 1997, under
applicable banking statutes, the total capital available for payment of
dividends by the Bank to the Company was approximately $7.3 million.
Federal and state bank regulatory agencies have the power to prohibit
any act, including the payment of dividends, if such act would reduce the Bank's
capital to a point that, in their opinion, would render the Bank
undercapitalized and thus constitute an unsafe or unsound banking practice. In
addition to restrictions on the payment of dividends, the Bank is subject to
certain restrictions imposed by federal law on any extensions of credit to, and
certain other transactions with, the Company and certain other affiliates, and
on investments in stock or other securities thereof. Such restrictions prevent
the Company and such other affiliates from borrowing from the Bank unless the
loans are secured by various types of collateral. Further, such secured loans,
other transactions and investments by the Bank are generally limited in amount
as to the Company and as to each of such other affiliates to 10% of the Bank's
capital
16
<PAGE>
and surplus and as to the Company and all of such other affiliates to an
aggregate of 20% of the Bank's capital and surplus.
RIGHT TO DEFER INTEREST PAYMENT OBLIGATION; TAX CONSEQUENCES; MARKET PRICE
CONSEQUENCES
So long as no event of default under the Indenture has occurred and is
continuing, American Bancorporation has the right under the Indenture to defer
the payment of interest on the Junior Subordinated Debentures, at any time or
from time to time, for a period not exceeding 20 consecutive quarters with
respect to each Extension Period, provided that no Extension Period may extend
beyond the Stated Maturity of the Junior Subordinated Debentures. As a
consequence of any such deferral, quarterly Distributions on the Preferred
Securities by the Trust Issuer would also be deferred (and the amount of
Distributions to which holders of the Preferred Securities are entitled would
accumulate additional Distributions thereon at the rate of ___% per annum,
compounded quarterly from the relevant payment date for such Distributions)
during any such Extension Period. During any such Extension Period, American
Bancorporation may not, and may not permit any subsidiary of American
Bancorporation to, (i) declare or pay any dividends or distributions on, or
redeem, purchase, acquire or make a liquidation payment with respect to, any of
American Bancorporation's capital stock, (other than (a) the reclassification of
American Bancorporation's capital stock into another class of capital stock, (b)
dividends or distributions in common stock of American Bancorporation, (c) any
declaration of a dividend in connection with the implementation of a
stockholders' rights plan, or the issuance of stock under any such plan in the
future or the redemption or repurchase of any such rights pursuant thereto, (d)
payments under the Guarantee and (e) purchases of common stock related to the
issuance of common stock or rights under any of American Bancorporation's
benefit plans for its directors, officers or employees), (ii) make any payment
of principal, interest or premium, if any, on or repay, repurchase or redeem any
debt securities of American Bancorporation that rank pari passu with or junior
in interest to the Junior Subordinated Debentures or (iii) make any guarantee
payments with respect to any guarantee by American Bancorporation of the debt
securities of any subsidiary of American Bancorporation if such guarantee ranks
pari passu with or junior in interest to the Junior Subordinated Debentures
other than payments pursuant to the Guarantee. Prior to the termination of any
such Extension Period, American Bancorporation may further defer the payment of
interest, provided that no Extension Period may exceed 20 consecutive quarters
or extend beyond the Stated Maturity of the Junior Subordinated Debentures. Upon
the termination of any Extension Period and the payment of all interest then
accrued and unpaid on the Junior Subordinated Debentures (together with interest
thereon at the annual rate of ___%, compounded quarterly from the relevant
payment date for such interest, to the extent permitted by applicable law),
American Bancorporation may elect to begin a new Extension Period subject to the
above requirements. There is no limitation on the number of times that American
Bancorporation may elect to begin an Extension Period so long as no event of
default under the Indenture has occurred and is continuing. See "Description of
the Preferred Securities--- Distributions" and "Description of the Junior
Subordinated Debentures--Right to Defer Interest Payment Obligation."
17
<PAGE>
If an Extension Period were to occur, a holder of the Preferred
Securities would continue to accrue income (in the form of original issue
discount) for United States federal income tax purposes in respect of its pro
rata share of the interest accruing on the Junior Subordinated Debentures held
by the Trust Issuer. As a result, a holder of the Preferred Securities would be
required to include such income in gross income for United States federal income
tax purposes in advance of the receipt of cash and would not receive the cash
related to such income from the Trust Issuer if the holder disposed of the
Preferred Securities prior to the record date for the payment of Distributions.
See "Certain Federal Income Tax Consequences--Interest Income and Original Issue
Discount" and "--Sales or Redemption of the Preferred Securities."
American Bancorporation has no current intention of exercising its
right to defer payments of interest on the Junior Subordinated Debentures.
However, should American Bancorporation elect to exercise such right in the
future, the market price of the Preferred Securities would likely be adversely
affected. A holder that disposed of its Preferred Securities during an Extension
Period, therefore, might not receive the same return on its investment as a
holder that continued to hold its Preferred Securities. In addition, as a result
of the existence of American Bancorporation's right to defer interest payments,
the market price of the Preferred Securities may be more volatile than the
market prices of other similar securities that are not subject to such
deferrals.
OPTIONAL REDEMPTION AFTER 2003
American Bancorporation has the right to redeem the Junior Subordinated
Debentures prior to their Stated Maturity on or after _______, 2003 in whole at
one time or in part from time to time. The exercise of such right may be subject
to American Bancorporation having received prior regulatory approval. See
"Description of the Junior Subordinated Debentures--General."
REDEMPTION DUE TO TAX EVENT, INVESTMENT COMPANY EVENT OR CAPITAL TREATMENT EVENT
American Bancorporation has the right, but not the obligation, to
redeem the Junior Subordinated Debentures in whole (but not in part) within 180
days following the occurrence of a Tax Event, an Investment Company Event or a
Capital Treatment Event (whether occurring before or after ________, 2003), and,
therefore, cause a mandatory redemption of the Preferred Securities. The
exercise of such right may be subject to American Bancorporation having received
prior regulatory approval.
A "Tax Event" means the receipt by the Trust Issuer of an Opinion of
Counsel to the effect that, as a result of any amendment to, or change
(including any announced prospective change) in, the laws (or any regulations
thereunder) of the United States or any political subdivision or taxing
authority thereof or therein, or as a result of any official administrative
pronouncement or judicial decision interpreting or applying such laws or
regulations, which amendment or change is effective or such pronouncement or
decision is announced on or after the date of issuance of the Preferred
Securities under the Trust Agreement, there is more than an insubstantial risk
that (i) the Trust Issuer is, or will be within 90 days of the date of such
opinion,
18
<PAGE>
subject to United States federal income tax with respect to income received or
accrued on the Junior Subordinated Debentures, (ii) interest payable by American
Bancorporation on the Junior Subordinated Debentures is not, or within 90 days
of the date of such opinion will not be, deductible by American Bancorporation,
in whole or in part, for United States federal income tax purposes or (iii) the
Trust Issuer is, or will be within 90 days of the date of such opinion, subject
to more than a de minimis amount of other taxes, duties or other governmental
charges. The Trust Issuer or American Bancorporation must request and receive an
opinion with regard to such matters within a reasonable period of time after it
becomes aware of the possible occurrence of any of the events described in
clauses (i) through (iii) above.
"Investment Company Event" means the receipt by the Trust Issuer of an
Opinion of Counsel to the effect that, as a result of the occurrence of a change
in law or regulation or a change in interpretation or application of law or
regulation by any legislative body, court, governmental agency or regulatory
authority, the Trust Issuer is or will be considered an "investment company"
that is required to be registered under the Investment Company Act of 1940, as
amended (the "Investment Company Act"), which change occurs or becomes effective
on or after the date of original issuance of the Preferred Securities.
"Capital Treatment Event" means the receipt by the Trust Issuer of an
Opinion of Counsel to the effect that as a result of any amendment to, or change
(including any proposed change) in, the laws (or any regulations thereunder) of
the United States or any political subdivision thereof or therein, or as a
result of any official or administrative pronouncement or action or judicial
decision interpreting or applying such laws or regulations, which amendment or
change is effective or such proposed change, pronouncement, action or decision
is announced on or after the date of original issuance of the Preferred
Securities, there is more than an insubstantial risk that the Preferred
Securities would not constitute Tier 1 Capital (or the then equivalent thereof)
applied as if American Bancorporation (or its successor) were a bank holding
company for purposes of applicable capital adequacy guidelines of the Federal
Reserve (or any successor regulatory authority with jurisdiction over bank
holding companies), or any capital adequacy guidelines as then in effect and
applicable to American Bancorporation.
"Opinion of Counsel" means an opinion in writing of independent legal
counsel experienced in such matters as are being opined upon.
EXCHANGE OF PREFERRED SECURITIES FOR JUNIOR SUBORDINATED DEBENTURES; REDEMPTION
AND TAX CONSEQUENCES
American Bancorporation has the right at any time to dissolve the Trust
Issuer and, after the satisfaction of liabilities to creditors of the Trust
Issuer as required by applicable law, cause the Junior Subordinated Debentures
to be distributed to the holders of the Preferred Securities in exchange
therefor in liquidation of the Trust Issuer. The exercise of such right may be
subject to American Bancorporation having received prior regulatory approval.
American Bancorporation will have the right, in certain circumstances, to redeem
the Junior Subordinated Debentures in whole or in part, in lieu of a
distribution of the Junior Subordinated Debentures by the Trust Issuer, in which
event the Trust Issuer will redeem the Preferred Securities on a pro rata basis
to the same extent as the Junior Subordinated Debentures are redeemed by
American
19
<PAGE>
Bancorporation. Any such distribution or redemption prior to the Stated Maturity
will be subject to prior regulatory approval if then required under applicable
capital guidelines or regulatory policies. See "Description of the Preferred
Securities--Liquidation of the Trust Issuer and Distribution of the Junior
Subordinated Debentures to Holders" and "Description of the Junior Subordinated
Debentures--Redemption or Exchange."
Under current United States federal income tax law, a distribution of
Junior Subordinated Debentures upon the dissolution of the Trust Issuer would
not be a taxable event to holders of the Preferred Securities. If, however, the
Trust Issuer were characterized as an association taxable as a corporation at
the time of the dissolution of the Trust Issuer, the distribution of the Junior
Subordinated Debentures would constitute a taxable event to holders of Preferred
Securities. Moreover, any redemption of the Preferred Securities for cash would
be a taxable event to such holders. See "Certain Federal Income Tax
Consequences--Distribution of the Junior Subordinated Debentures to Holders of
the Preferred Securities" and "--Sales or Redemption of the Preferred
Securities."
There can be no assurance as to the market prices for the Preferred
Securities or the Junior Subordinated Debentures that may be distributed in
exchange for Preferred Securities upon a dissolution or liquidation of the Trust
Issuer. The Preferred Securities or the Junior Subordinated Debentures may trade
at a discount to the price that the investor paid to purchase the Preferred
Securities offered hereby. Because holders of Preferred Securities may receive
Junior Subordinated Debentures as a result of the liquidation of the Trust, and
because payments on the Junior Subordinated Debentures are the sole source of
funds for Distributions and redemptions of the Preferred Securities, prospective
purchasers of Preferred Securities are also making an investment decision with
regard to the Junior Subordinated Debentures and should carefully review all the
information regarding the Junior Subordinated Debentures contained herein.
If the Junior Subordinated Debentures are distributed to the holders of
Preferred Securities upon the liquidation of the Trust Issuer, American
Bancorporation will use its reasonable efforts to list the Junior Subordinated
Debentures on the Nasdaq Stock Market's National Market or SmallCap Market or
such stock exchanges, if any, on which the Preferred Securities are then listed.
RIGHTS UNDER THE GUARANTEE
The Guarantee guarantees to the holders of the Preferred Securities the
following payments, to the extent not paid by the Trust Issuer: (i) any
accumulated and unpaid Distributions required to be paid on the Preferred
Securities, to the extent that the Trust Issuer has funds on hand available
therefor at such time, (ii) the redemption price with respect to any Preferred
Securities called for redemption, to the extent that the Trust Issuer has funds
on hand available therefor at such time, and (iii) upon a voluntary or
involuntary dissolution, winding-up or liquidation of the Trust Issuer (unless
the Junior Subordinated Debentures are distributed to holders of the Preferred
Securities in exchange therefor), the lesser of (a) the aggregate of the
Liquidation Amount and all accumulated and unpaid Distributions to the date of
payment, to the extent that the Trust Issuer has funds on hand available
therefor at such time, and (b) the amount
20
<PAGE>
of assets of the Trust Issuer remaining available for distribution to holders of
the Preferred Securities after payment of creditors of the Trust Issuer as
required by applicable law.
If American Bancorporation were to default on its obligation to pay
amounts payable under the Junior Subordinated Debentures, the Trust Issuer would
lack funds for the payment of Distributions or amounts payable on redemption of
the Preferred Securities or otherwise, and, in such event, holders of the
Preferred Securities would not be able to rely upon the Guarantee for payment of
such amounts. The holders of not less than a majority in aggregate Liquidation
Amount of the Preferred Securities have the right to direct the time, method and
place of conducting any proceeding for any remedy available to the Guarantee
Trustee in respect of the Guarantee or to direct the exercise of any trust power
conferred upon the Guarantee Trustee under the Guarantee. Any holder of the
Preferred Securities may institute a legal proceeding directly against American
Bancorporation to enforce its rights under the Guarantee without first
instituting a legal proceeding against the Trust Issuer, the Guarantee Trustee
or any other person or entity. In the event an event of default under the
Indenture shall have occurred and be continuing and such event is attributable
to the failure of American Bancorporation to pay interest on or principal of the
Junior Subordinated Debentures on the applicable payment date, a holder of the
Preferred Securities may institute a legal proceeding directly against American
Bancorporation for enforcement of payment to such holder of the principal of or
interest on such Junior Subordinated Debentures having a principal amount equal
to the aggregate Liquidation Amount of the Preferred Securities of such holder
(a "Direct Action"). The exercise by American Bancorporation of its right, as
described herein, to defer the payment of interest on the Junior Subordinated
Debentures does not constitute an event of default under the Indenture. In
connection with any Direct Action, American Bancorporation will have a right of
set-off under the Indenture to the extent of any payment made by American
Bancorporation to such holder of the Preferred Securities in the Direct Action.
Except as described herein, holders of the Preferred Securities will not be able
to exercise directly any other remedy available to the holders of the Junior
Subordinated Debentures or assert directly any other rights in respect of the
Junior Subordinated Debentures. The Bank of New York will act as the guarantee
trustee under the Guarantee (the "Guarantee Trustee") and will hold the
Guarantee for the benefit of the holders of the Preferred Securities. The Bank
of New York will also act as Debenture Trustee for the Junior Subordinated
Debentures and as Property Trustee, and The Bank of New York (Delaware) will act
as Delaware Trustee under the Trust Agreement. See "Description of the Junior
Subordinated Debentures-- Enforcement of Certain Rights by Holders of the
Preferred Securities," "Description of the Junior Subordinated
Debentures--Debenture Events of Default" and "Description of the Guarantee." The
Trust Agreement provides that each holder of the Preferred Securities by
acceptance thereof agrees to the provisions of the Guarantee and the Indenture.
LIMITED COVENANTS
The covenants in the Indenture are limited and there are no covenants
in the Trust Agreement. As a result, neither the Indenture nor the Trust
Agreement protects holders of Junior Subordinated Debentures or Preferred
Securities, respectively, in the event of a material adverse change in American
Bancorporation's financial condition or results of operations or limits the
ability of American Bancorporation or any subsidiary to incur or assume
additional indebtedness or other obligations. Additionally, neither the
Indenture nor the Trust Agreement contains any
21
<PAGE>
financial ratios or specified levels of liquidity to which American
Bancorporation must adhere. Therefore, the provisions of these governing
instruments should not be considered a significant factor in evaluating whether
American Bancorporation will be able to or will comply with its obligations
under the Junior Subordinated Debentures or the Guarantee.
LIMITED VOTING RIGHTS
Holders of the Preferred Securities will generally have limited voting
rights relating only to the modification of the Preferred Securities and the
exercise of the Trust Issuer's rights as holder of the Junior Subordinated
Debentures and the Guarantee. Holders of the Preferred Securities will not be
entitled to vote to appoint, remove or replace the Property Trustee, the
Delaware Trustee or the Administrative Trustees, as such voting rights are
vested exclusively in American Bancorporation, as the holder of the Common
Securities (except, with respect to the Property Trustee and the Delaware
Trustee, upon the occurrence of certain events described herein). The Property
Trustee, the Administrative Trustees and American Bancorporation may amend the
Trust Agreement without the consent of holders of the Preferred Securities to
ensure that the Trust Issuer will be classified for United States federal income
tax purposes as a grantor trust even if such action adversely affects the
interests of such holders. See "Description of the Preferred Securities--Voting
Rights; Amendment of the Trust Agreement" and "--Removal of the Trust Issuer
Trustees."
ABSENCE OF PRIOR PUBLIC MARKET FOR THE PREFERRED SECURITIES; TRADING PRICE AND
TAX CONSIDERATIONS
There is no current public market for the Preferred Securities. An
application has been filed to list the Preferred Securities on the Nasdaq Stock
Market's National Market. However, the requirements for listing and continued
listing is the presence of three initial market makers for the Preferred
Securities, at least 1.1 million shares, not including shares held by
affiliates, and at least 400 stockholders. American Bancorporation has been
advised that the Underwriter intends to make a market in the Preferred
Securities. However, the Underwriter is not obligated to do so and such market
making may be discontinued at any time. Therefore, there is no assurance that an
active trading market will develop for the Preferred Securities or, if such
market develops, that it will be maintained or that the market price will equal
or exceed the public offering price set forth on the cover page of this
Prospectus. Accordingly, holders of Preferred Securities may experience
difficulty reselling them or may be unable to sell them at all. The public
offering price for the Preferred Securities has been determined through
negotiations between American Bancorporation and the Underwriter. Prices for the
Preferred Securities will be determined in the marketplace and may be influenced
by many factors, including prevailing interest rates, the liquidity of the
market for the Preferred Securities, investor perceptions of American
Bancorporation and general industry and economic conditions.
Further, should American Bancorporation exercise its option to defer
any payment of interest on the Junior Subordinated Debentures, the Preferred
Securities would be likely to trade at prices that do not fully reflect the
value of accrued but unpaid interest with respect to the underlying Junior
Subordinated Debentures. In the event of such a deferral, a holder of Preferred
Securities that disposed of its Preferred Securities between record dates for
payments of
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<PAGE>
Distributions (and consequently did not receive a Distribution from the Trust
Issuer for the period prior to such disposition) would nevertheless be required
to include accrued but unpaid interest on the Junior Subordinated Debentures
through the date of disposition in income as ordinary income and to add such
amount to the adjusted tax basis of the Preferred Securities disposed of. Upon
disposition of the Preferred Securities, such holder would recognize a capital
loss to the extent the selling price (which might not fully reflect the value of
accrued but unpaid interest) was less than its adjusted tax basis (which would
include all accrued but unpaid interest). Subject to certain limited exceptions,
capital losses cannot be applied to offset ordinary income for United States
federal income tax purposes. See "Certain Federal Income Tax Consequences--
Sales or Redemption of the Preferred Securities."
POSSIBLE TAX LAW CHANGES AFFECTING THE PREFERRED SECURITIES
Under current law, American Bancorporation will be able to deduct
interest on the Junior Subordinated Debentures. However, there is no assurance
that future legislation will not affect the ability of the Company to deduct
interest on the Junior Subordinated Debentures. Such a change would give rise to
a Tax Event. A Tax Event would permit American Bancorporation, upon receipt of
regulatory approval if then required under applicable capital guidelines or
regulatory policies, to cause a redemption of the Preferred Securities before,
as well as after, ________, 2003. See "Description of the Junior Subordinated
Debentures--Redemption or Exchange."
RISK FACTORS RELATING TO THE COMPANY
POTENTIAL IMPACT OF CHANGES IN INTEREST RATES
The Bank's profitability is dependent to a large extent on its net
interest income, which is the difference between its income on interest-earning
assets and its expense on interest-bearing liabilities. The Bank, like most
financial institutions, is affected by changes in general interest rate levels
and by other economic factors beyond its control. Interest rate risk arises in
part from mismatches (i.e., the interest sensitivity gap) between the dollar
amount of repricing or maturing assets and liabilities, and is measured in terms
of the ratio of the interest rate sensitivity gap to total assets. More assets
than liabilities repricing or maturing over a given time frame is considered
asset-sensitive and is reflected as a positive gap, and more liabilities than
assets repricing or maturing over a given time frame is considered
liability-sensitive and is reflected as a negative gap. A liability-sensitive
position (i.e., a negative gap) will generally enhance earnings in a falling
interest rate environment and reduce earnings in a rising interest rate
environment, while an asset-sensitive position (i.e., a positive gap) will
generally enhance earnings in a rising interest rate environment and will reduce
earnings in a falling interest rate environment. Fluctuations in interest rates
are not predictable or controllable. The Company utilizes OTS guidelines in
calculating their gap position.
23
<PAGE>
COMPOSITION OF LOAN PORTFOLIO
A majority of the loans in the Company's portfolio are secured by real
estate. At December 31, 1997, the Company estimates that a substantial majority
of its total loans receivable were secured by properties located in its primary
market areas of central and eastern Ohio and northern West Virginia. Conditions
in the real estate markets in which the collateral for the Company's mortgage
loans are located strongly influence the level of the Company's non-performing
loans and its results of operations. Real estate values are affected by, among
other things, changes in general or local economic conditions, changes in
governmental rules or policies, the availability of loans to potential
purchasers, and natural disasters. Declines in real estate markets could
negatively impact the value of the collateral securing the Company's loans and
its results of operations.
As of December 31, 1997, $121.3 million, or 42.3% of the Company's
total loan portfolio consisted of loans secured by first liens on one- to
four-family residences. At that date, $1.0 million or 0.3% of the Company's
total loan portfolio consisted of construction loans, $24.1 million or 8.4% of
the Company's total loan portfolio consisted of home equity loans and lines of
credit, an aggregate of $75.1 million or 26.2% of the Company's total loan
portfolio consisted of consumer loans and commercial loans and $65.2 million or
22.8% of the Company's total loan portfolio consisted of commercial real estate
and multi-family real estate loans. Although these types of loans generally have
higher yields than one- to four-family loans, such loans generally carry a
higher level of credit risk than do single-family residential loans.
ASSET QUALITY
The future success of the Company is dependent upon the quality of its
assets. Although management of the Company devotes substantial time and
resources to the identification, collection and work-out of non-performing
assets, the real estate markets and the overall economy in its market area are
likely to be significant determinants of the quality of the Company's assets in
future periods and, thus, its financial condition and results of operations.
During the fiscal year ended December 31, 1997, total non-performing assets
increased by $0.3 million or 12.6%. Nonaccrual loans due increased by $0.3
million and loans 90 days past due increased $0.5 million while restructured
loans decreased by $0.1 million and other real estate owned decreased by $0.4
million.
ALLOWANCE FOR LOAN LOSSES
Industry experience indicates that a portion of the Company's loans
will become delinquent and a portion of the loans may require partial or entire
charge-off. Regardless of the underwriting criteria utilized by the Company,
losses may be experienced as a result of various factors beyond the Company's
control, including, among other things, changes in market conditions affecting
the value of properties and problems affecting the credit of the borrower. The
Company's determination of the adequacy of its allowance for loan losses is
based on various considerations, including an analysis of the risk
characteristics of various classifications of loans, previous loan loss
experience, specific loans which would have loan loss potential, delinquency
trends, estimated fair value of the underlying collateral, current economic
conditions, the views
24
<PAGE>
of the Company's regulators (who have the authority to require additional
reserves), and geographic and industry loan concentration. However, if
delinquency levels were to increase as a result of adverse general economic
conditions, especially in Ohio and West Virginia where the Company's exposure is
greatest, the loan loss reserve so determined by the Company may not be
adequate. There can be no assurance that the allowance will be adequate to cover
loan losses or that the Company will not experience significant losses in its
loan portfolios which may require significant increases to the allowance for
loan losses in the future. While the Company has not made a provision for loan
losses since 1995, it is likely that the Company will begin making a provision
to the allowance for loan losses during 1998. The increase in the amount of the
Company's provision for loan losses is due to both the increased levels of loan
originations as well as the increase in the Company's non-performing assets.
There can be no assurance that the Company will not further increase its
provision for loan losses, which could negatively impact results of operations.
At December 31, 1997, the ratio of the Company's allowance for loan losses to
total loans was 1.15%, and the allowance for loan losses to non-performing loans
was 123.56%.
REGULATORY OVERSIGHT
The Bank is subject to extensive regulation, supervision and
examination by the Department as its chartering authority and primary regulator,
and by the FDIC, which insures its deposits up to applicable limits. The Bank is
a member of the FHLB of Pittsburgh and is subject to certain limited regulation
by the Federal Reserve Board. As the holding company of the Bank, American
Bancorporation is also subject to regulation and oversight by the Federal
Reserve Board. Such regulation and supervision governs the activities in which
an institution may engage and is intended primarily for the protection of the
FDIC insurance funds and depositors. Regulatory authorities have been granted
extensive discretion in connection with their supervisory and enforcement
activities and regulations have been implemented which have increased capital
requirements, increased insurance premiums and have resulted in increased
administrative, professional and compensation expenses. Any change in the
regulatory structure or the applicable statutes or regulations could have a
material impact on the Company and the Bank and their operations. Additional
legislation and regulations may be enacted or adopted in the future which could
significantly affect the powers, authority and operations of the Bank and the
Bank's competitors which in turn could have a material adverse effect on the
Bank and its operations.
COMPETITION
The Company faces substantial competition in purchasing and originating
real estate loans and in attracting deposits. The Company's competition in
originating real estate loans is principally from banks, other thrifts, mortgage
banking companies, real estate financing conduits, and small insurance
companies. Although it has not done so in recent years, in purchasing real
estate loans, the Company competes with other participants in the secondary
mortgage market. Many entities competing with the Company enjoy competitive
advantages over the Company relative to a potential borrower or seller in terms
of a prior business relationship, wide geographic presence or more accessible
branch office locations, the ability to offer additional services or more
favorable pricing alternatives, a lower origination and operating cost
structure, and other relevant items. Increased competition in the areas in which
the Company conducts operations
25
<PAGE>
from traditional competitors or new sources could result in a decrease in the
origination or purchase of mortgage loans and could adversely affect the
Company's results of operations. In its deposit gathering activities, the
Company competes with insured depository institutions such as thrifts, credit
unions, and banks, as well as uninsured investment alternatives including money
market funds. These competitors may offer higher rates than the Company, which
could result in the Company either attracting fewer deposits or in requiring the
Company to increase the rates it pays to attract deposits. Increased deposit
competition could adversely affect the Company's ability to generate the funds
necessary for its lending operations and could adversely affect the Company's
results of operations.
USE OF PROCEEDS
All of the proceeds from the sale of the Preferred Securities will be
invested by the Trust Issuer in Junior Subordinated Debentures. The net proceeds
to the Company from the sale of the Junior Subordinated Debentures are estimated
to be approximately $____ million ($____ million if the Underwriter's
over-allotment option is exercised in full after deduction of the underwriting
discount and estimated expenses), American Bancorporation intends to use the net
proceeds from the sale of the Junior Subordinated Debentures for general
corporate purposes, including, but not limited to, acquisitions by either the
Company or the Bank (although there presently exist no agreements or
understandings with respect to any such acquisition), capital contributions to
the Bank to support growth and for working capital, including continuation of
the wholesale leveraging strategy discussed under "Summary - American
Bancorporation" and possible repurchase of shares of American Bancorporation's
common stock, subject to regulatory requirements and acceptable market
conditions.
MARKET FOR THE PREFERRED SECURITIES
An application has been filed to list the Preferred Securities on the
Nasdaq Stock Market's National Market under the symbol "AMBCP." Although the
Underwriter has informed the Company that it presently intends to make a market
in the Preferred Securities, the Underwriter is not obligated to do so and any
such market making may be discontinued at any time. Accordingly, there is no
assurance that an active and liquid trading market will develop or, if
developed, that such a market will be sustained. The offering price and
distribution rate have been determined by negotiations among representatives of
the Company and the Underwriter, and the offering price of the Preferred
Securities may not be indicative of the market price following the offering. See
"Underwriting."
ACCOUNTING TREATMENT
For financial reporting purposes, the Trust Issuer will be treated as a
subsidiary of the Company and, accordingly, the Trust Issuer's financial
statements will be included in the consolidated financial statements of the
Company. The Preferred Securities will be presented as a separate line item in
the consolidated balance sheet of the Company under the caption "Guaranteed
Preferred Beneficial Interests in the Company's Junior Subordinated Debentures"
and
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<PAGE>
appropriate disclosures about the Preferred Securities will be included in the
notes to the consolidated financial statements. For financial reporting
purposes, the Company will record distributions payable on the Preferred
Securities as an interest expense in the consolidated statements of operations.
In its future financial reports, the Company will: (i) present the
Preferred Securities on the Company's statements of financial condition as a
separate line item entitled "Guaranteed Preferred Beneficial Interests in the
Company's Junior Subordinated Debentures;" (ii) include in a footnote to the
financial statements disclosure that the sole assets of the Trust Issuer are the
Junior Subordinated Debentures specifying the principal amount, interest rate
and maturity date of Junior Subordinated Debentures held; and (iii) if Staff
Accounting Bulletin No. 53 treatment is sought, include, in an audited footnote
to the financial statements, disclosure that (a) the Trust Issuer is wholly
owned, (b) the sole assets of the Trust Issuer are its Junior Subordinated
Debentures, and (c) the obligations of the Company under the Junior Subordinated
Debentures, the Indenture, the Trust Agreement and the Guarantee, in the
aggregate, constitute a full and unconditional guarantee by the Company of the
Trust Issuer's obligations under the Preferred Securities.
RATIO OF EARNINGS TO FIXED CHARGES
The following table sets forth the Company's consolidated ratios of
earnings to fixed charges for the periods indicated.
<TABLE>
<CAPTION>
Year Ended December 31,
--------------------------------------------------------------------
1997 1996 1995 1994 1993
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Earnings to Fixed Charges:
Including interest on deposits....... 1.39x 1.42x 1.43x 1.36x 1.35x
Excluding interest on deposits....... 2.39x 3.01x 4.50x 17.21x 44.27x
</TABLE>
For purposes of computing the ratios of earnings to fixed charges,
earnings represent income from continuing operations before income taxes,
extraordinary items and cumulative effect of a change in accounting principle
plus fixed charges. Fixed charges represent total interest expense, including
and excluding interest on deposits, as applicable.
27
<PAGE>
CAPITALIZATION
The following table sets forth the consolidated capitalization of the
Company as of December 31, 1997, as adjusted to give effect to the consummation
of the offering of the Trust Preferred Securities. The following data should be
read in conjunction with the financial information included in documents
incorporated herein by reference. See "Incorporation of Certain Documents by
Reference".
<TABLE>
<CAPTION>
As
Actual Adjusted
(In thousands)
<S> <C> <C>
Deposits............................................................... $ 355,734 $ 355,734
Borrowings:
FHLB of Pittsburgh advances........................................ 74,000 74,000
Securities sold under repurchase agreements........................ 7,912 7,912
Other borrowings................................................... 7,087 7,087
--------- ---------
Total deposits and borrowed funds............................... 444,733 444,733
--------- ---------
Guaranteed Preferred Beneficial Interests in the
Company's Junior Subordinated Debentures(1)........................... -- 11,000
--------- ---------
Stockholders' equity:
Preferred Stock, $100 par value; 200,000 shares
authorized; none issued.......................................... -- --
Common stock, no par value, 6,500,000 shares 7,824 7,824
authorized; 3,129,674 issued and outstanding ....................
Additional paid-in capital............................................. 10,302 10,302
Net unrealized gain on securities available for sale, net.............. 603 603
Retained earnings...................................................... 14,965 14,965
--------- ---------
Total stockholders' equity...................................... 33,694 33,694
--------- ---------
</TABLE>
(1) Preferred Securities of the Trust Issuer representing beneficial interests
in $11.0 million aggregate principal amount of the Junior Subordinated
Debentures issued by the Company to the Trust Issuer. The Junior
Subordinated Debentures will bear interest at the annual rate of __% of the
principal amount thereof, payable quarterly and will mature on ________,
2028. The Company owns all of the Common Securities of the Trust Issuer.
28
<PAGE>
DESCRIPTION OF THE PREFERRED SECURITIES
GENERAL
The following is a summary of certain terms and provisions of the
Preferred Securities. This summary of certain terms and provisions of the
Preferred Securities does not purport to be complete and is subject to, and
qualified in its entirety by reference to, the Trust Agreement. Wherever
particular defined terms of the Trust Agreement are referred to, but not defined
herein, such defined terms are incorporated herein by reference. The form of the
Trust Agreement has been filed as an exhibit to the Registration Statement of
which this Prospectus forms a part. Unless otherwise expressly stated or the
context otherwise requires, all references to the "Company" appearing under this
caption "Description of the Preferred Securities" and under the caption
"Description of the Junior Subordinated Debentures" shall mean American
Bancorporation excluding its consolidated subsidiaries.
DISTRIBUTIONS
The Preferred Securities represent preferred undivided beneficial
interests in the assets of the Trust Issuer. Distributions on such Preferred
Securities will be payable at the annual rate of ___% of the stated Liquidation
Amount of $10, payable quarterly in arrears on March 1, June 1, September 1 and
December 1 of each year, to the holders of the Preferred Securities on the
relevant record dates. The record date will be the 15th day of the preceding
month in which the relevant Distribution payment date occurs. Distributions will
accumulate from the date of the initial issuance of the Preferred Securities and
are cumulative. The first Distribution payment date for the Preferred Securities
will be ______, 1998. The amount of Distributions payable for any period will be
computed on the basis of a 360-day year of twelve 30-day months. In the event
that any date on which Distributions are payable on the Preferred Securities is
not a Business Day, then payment of the Distributions payable on such date will
be made on the next succeeding day that is a Business Day (and without any
additional Distributions or other payment in respect of any such delay), except
that, if such Business Day is in the next succeeding calendar year, such payment
shall be made on the immediately preceding Business Day, in each case with the
same force and effect as if made on the date such payment was originally payable
(each date on which Distributions are payable in accordance with the foregoing,
a "Distribution Date"). A "Business Day" shall mean any day other than a
Saturday or a Sunday, or a day on which banking institutions in the City of New
York are authorized or required by law or executive order to remain closed or a
day on which the principal corporate trust office of the Property Trustee or the
Debenture Trustee is closed for business.
So long as no event of default under the Indenture has occurred and is
continuing, the Company has the right under the Indenture to defer the payment
of interest on the Junior Subordinated Debentures at any time or from time to
time for a period not exceeding 20 consecutive quarters with respect to each
Extension Period, provided that no Extension Period may extend beyond the Stated
Maturity of the Junior Subordinated Debentures. As a consequence of any such
deferral of interest, quarterly Distributions on the Preferred Securities
29
<PAGE>
by the Trust Issuer will also be deferred during any such Extension Period.
Distributions to which holders of the Preferred Securities are entitled will
accumulate additional Distributions thereon at the rate per annum of ___%
thereof, compounded quarterly from the relevant payment date for such
Distributions. The term "Distributions" as used herein, shall include any such
additional Distributions. During any such Extension Period, the Company may not,
and may not permit any subsidiary of the Company to, (i) declare or pay any
dividends or distributions on, or redeem, purchase, acquire or make a
liquidation payment with respect to, any of the Company's capital stock other
than payments pursuant to the Guarantee (other than (a) the reclassification of
any class of the Company's capital stock into another class of capital stock,
(b) dividends or distributions in common stock of the Company, (c) any
declaration of a dividend in connection with the implementation of a
stockholders' rights plan, or the issuance of stock under any such plan in the
future or the redemption or repurchase of any such rights pursuant thereto, (d)
payments under the Guarantee and (e) purchases of common stock related to the
issuance of common stock or rights under any of the Company's benefit plans for
its directors, officers or employees), (ii) make any payment of principal,
interest or premium, if any, on or repay, repurchase or redeem any debt
securities of the Company that rank pari passu with or junior in interest to the
Junior Subordinated Debentures or (iii) make any guarantee payments with respect
to any guarantee by the Company of the debt securities of any subsidiary of the
Company if such guarantee ranks pari passu with or junior in interest to the
Junior Subordinated Debentures other than payments pursuant to the Guarantee.
Prior to the termination of any such Extension Period, the Company may further
defer the payment of interest on the Junior Subordinated Debentures, provided
that no Extension Period may exceed 20 consecutive quarters periods or extend
beyond the Stated Maturity of the Junior Subordinated Debentures. Upon the
termination of any such Extension Period and the payment of all interest then
accrued and unpaid (together with interest thereon at the rate of ___%,
compounded quarterly, to the extent permitted by applicable law), the Company
may elect to begin a new Extension Period. There is no limitation on the number
of times that the Company may elect to begin an Extension Period. See
"Description of the Junior Subordinated Debentures--Right to Defer Interest
Payment Obligation" and "Certain Federal Income Tax Consequences--Interest
Income and Original Issue Discount."
The revenue of the Trust Issuer available for distribution to holders
of its Preferred Securities will be limited to payments under the Junior
Subordinated Debentures in which the Trust Issuer will invest the proceeds from
the issuance and sale of its Trust Securities. See "Description of the Junior
Subordinated Debentures." If the Company does not make interest payments on the
Junior Subordinated Debentures, the Property Trustee will not have funds
available to pay Distributions on the Preferred Securities. The payment of
Distributions (if and to the extent the Trust Issuer has funds legally available
for the payment of such Distributions and cash sufficient to make such payments)
is guaranteed by the Company on a limited basis as set forth herein under
"Description of the Guarantee."
The Company has no current intention of exercising its right to defer
payments of interest on the Junior Subordinated Debentures.
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SUBORDINATION OF THE COMMON SECURITIES
Payment of Distributions on, and the Redemption Price of, the Preferred
Securities and Common Securities, as applicable, shall be made pro rata based on
the Liquidation Amount of the Preferred Securities and the Common Securities;
provided, however, that if on any Distribution Date or Redemption Date an event
of default under the Indenture shall have occurred and be continuing, no payment
of any Distribution on, or Redemption Price of, any of the Common Securities,
and no other payment on account of the redemption, liquidation or other
acquisition of such Common Securities, shall be made unless payment in full in
cash of all accumulated and unpaid Distributions on all of the outstanding
Preferred Securities for all Distribution periods terminating on or prior
thereto, or, in the case of payment of the Redemption Price, the full amount of
such Redemption Price on all of the outstanding Preferred Securities then called
for redemption shall have been made or provided for, and all funds available to
the Property Trustee shall first be applied to the payment in full in cash of
all Distributions on, or Redemption Price of, the Preferred Securities then due
and payable.
In the case of any event of default under the Trust Agreement resulting
from an event of default under the Indenture, the Company as holder of the
Common Securities will be deemed to have waived any right to act with respect to
any such event of default under the Trust Agreement until the effect of all such
events of default with respect to the Preferred Securities shall have been
cured, waived or otherwise eliminated. Until any such events of default under
the Trust Agreement shall have been so cured, waived or otherwise eliminated,
the Property Trustee shall act solely on behalf of the holders of the Preferred
Securities and not on behalf of the Company as holder of the Common Securities,
and only the holders of the Preferred Securities will have the right to direct
the Property Trustee to act on their behalf.
REDEMPTION
The Preferred Securities are subject to mandatory redemption, in whole
or in part, upon repayment of the Junior Subordinated Debentures at their Stated
Maturity or earlier redemption as provided in the Indenture. The proceeds from
such repayment or redemption shall be applied by the Property Trustee to redeem
a Like Amount (as defined below) of the Preferred Securities upon not less than
30 nor more than 60 days notice prior to the date fixed for repayment or
redemption, at a redemption price equal to the aggregate Liquidation Amount of
such Preferred Securities plus accumulated and unpaid Distributions thereon (the
"Redemption Price") to the date of redemption (the "Redemption Date"). For a
description of the Stated Maturity and redemption provisions of the Junior
Subordinated Debentures, see "Description of the Junior Subordinated
Debentures--General" and "--Redemption or Exchange."
The Company has the option to redeem the Junior Subordinated Debentures
prior to maturity on or after ________, 2003, in whole at any time or in part
from time to time, and thereby cause a mandatory redemption of a Like Amount of
the Preferred Securities. See "Description of the Junior Subordinated
Debentures--Redemption or Exchange." Any time that a Tax Event, an Investment
Company Event or a Capital Treatment Event (each as defined
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below) shall occur and be continuing, the Company has the right to redeem the
Junior Subordinated Debentures in whole (but not in part) and thereby cause a
mandatory redemption of the Preferred Securities in whole (but not in part). See
"Description of the Junior Subordinated Debentures--Redemption or Exchange."
REDEMPTION PROCEDURES
Preferred Securities redeemed on each Redemption Date shall be redeemed
at the Redemption Price with the applicable proceeds from the contemporaneous
redemption of a Like Amount of the Junior Subordinated Debentures. Redemptions
of the Preferred Securities shall be made and the Redemption Price shall be paid
on each Redemption Date only to the extent that the Trust Issuer has funds on
hand available for the payment of such Redemption Price. See also "Description
of the Preferred Securities--Subordination of the Common Securities."
If the Trust Issuer gives a notice of redemption in respect of the
Preferred Securities, then, by 10:00 a.m., New York City time, on the Redemption
Date, to the extent funds are available, the Property Trustee will deposit
irrevocably with the DTC funds sufficient to pay the applicable Redemption Price
and will give DTC irrevocable instructions and authority to pay the Redemption
Price to the holders thereof upon surrender of their certificates evidencing
such Preferred Securities. Notwithstanding the foregoing, Distributions payable
on or prior to the Redemption Date for the Preferred Securities called for
redemption shall be payable to the holders of the Preferred Securities on the
relevant record dates for the related Distribution Dates. If notice of
redemption shall have been given and funds deposited as required, then, upon the
date of such deposit, all rights of the holders of such Preferred Securities so
called for redemption will cease, except the right of the holders of such
Preferred Securities to receive the Redemption Price, but without interest on
such Redemption Price, and such Preferred Securities will cease to be
outstanding.
In the event that any date fixed for redemption of the Preferred
Securities is not a Business Day, then payment of the Redemption Price payable
on such date will be made on the next succeeding day which is a Business Day
(and without any interest or other payment in respect of any such delay), except
that, if such Business Day falls in the next calendar year, such payment will be
made on the immediately preceding Business Day. In the event that payment of the
Redemption Price in respect of the Preferred Securities called for redemption is
improperly withheld or refused and not paid either by the Trust Issuer or by the
Company pursuant to the Guarantee as described under "Description of the
Guarantee," Distributions on such Preferred Securities will continue to accrue
at the then applicable rate, from the Redemption Date originally established by
the Trust Issuer for such Preferred Securities to the date such Redemption Price
is actually paid, in which case the actual payment date will be the date fixed
for redemption for purposes of calculating the Redemption Price.
Subject to applicable law (including, without limitation, United States
federal securities law), the Company or its subsidiaries may at any time and
from time to time purchase outstanding Preferred Securities by private
agreement.
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Payment of the Redemption Price on the Preferred Securities and any
distribution of the Junior Subordinated Debentures to holders of the Preferred
Securities shall be made to the applicable recordholders thereof as they appear
on the register for the Preferred Securities on the relevant record date, which
date shall be one Business Day prior to the relevant Redemption Date, however,
in the event the Preferred Securities do not remain in book entry form, the
relevant record date shall be the date at least 15 days prior to the Redemption
Date or liquidation date, as applicable.
If less than all of the Preferred Securities and Common Securities
issued by the Trust Issuer are to be redeemed on a Redemption Date, then the
aggregate Liquidation Amount of the Preferred Securities and Common Securities
to be redeemed shall be allocated pro rata to the Preferred Securities and the
Common Securities based upon the relative Liquidation Amounts of such classes.
The particular Preferred Securities to be redeemed shall be selected not more
than 60 days prior to the Redemption Date by the Property Trustee from the
outstanding Preferred Securities not previously called for redemption, or if the
Preferred Securities are then held in the form of a global preferred security in
accordance with DTC's customary procedures. The Property Trustee shall promptly
notify the trust registrar in writing of the Preferred Securities selected for
redemption and, in the case of any Preferred Securities selected for partial
redemption, the Liquidation Amount thereof to be redeemed. For all purposes of
the Trust Agreement, unless the context otherwise requires, all provisions
relating to the redemption of the Preferred Securities shall relate, in the case
of the Preferred Securities redeemed or to be redeemed only in part, to the
portion of the aggregate Liquidation Amount of the Preferred Securities which
has been or is to be redeemed.
Notice of any redemption will be mailed at least 30 days but not more
than 60 days before the Redemption Date to each holder of the Preferred
Securities to be redeemed at its registered address. Unless the Company defaults
in payment of the Redemption Price on the Junior Subordinated Debentures, on and
after the Redemption Date interest will cease to accrue on the Junior
Subordinated Debentures or portions thereof called for redemption.
LIQUIDATION OF THE TRUST ISSUER AND DISTRIBUTION OF THE JUNIOR SUBORDINATED
DEBENTURES TO HOLDERS
The Company has the right at any time to dissolve the Trust Issuer and,
after satisfaction of the liabilities of creditors of the Trust Issuer as
provided by applicable law, cause Junior Subordinated Debentures to be
distributed to the holders of the Preferred Securities and Common Securities in
exchange therefor upon liquidation of the Trust Issuer.
After the liquidation date fixed for any distribution of the Junior
Subordinated Debentures for Preferred Securities (i) such Preferred Securities
will no longer be deemed to be outstanding, and (ii) DTC or its nominee, as the
registered holder of Preferred Securities, will receive a registered global
certificate or certificates representing the Junior Subordinated Debentures to
be delivered upon such distribution with respect to Preferred Securities held by
DTC or its nominee, (iii) any certificates representing the Preferred Securities
not held by DTC or its nominee will be deemed to represent Junior Subordinated
Debentures having a principal amount equal to the
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stated Liquidation Amount of such Preferred Securities, and bearing accrued and
unpaid interest in an amount equal to the accumulated and unpaid Distributions
on such series of the Preferred Securities until such certificates are presented
to the Administrative Trustees or their agent for transfer or reissuance.
Under current United States federal income tax law and interpretations,
a distribution of the Junior Subordinated Debentures should not be a taxable
event to holders of the Preferred Securities. Should there be a change in law, a
change in legal interpretation, a Tax Event or other circumstances, however, the
distribution could be a taxable event to holders of the Preferred Securities.
See "Certain Federal Income Tax Consequences--Distribution of the Junior
Subordinated Debentures to Holders of the Preferred Securities."
LIQUIDATION DISTRIBUTION UPON DISSOLUTION
Pursuant to the Trust Agreement, the Trust Issuer shall automatically
dissolve upon expiration of its term and shall dissolve on the first to occur of
(i) certain events of bankruptcy, dissolution or liquidation of the Company,
subject in certain instances to any such event remaining in effect for a period
of 90 consecutive days; (ii) the distribution of a Like Amount of the Junior
Subordinated Debentures to the holders of its Preferred Securities, if the
Company, as depositor, has given written direction to the Property Trustee to
dissolve the Trust Issuer (which direction is optional and wholly within the
discretion of the Company, as depositor); (iii) redemption of all of the
Preferred Securities as described under "Description of the Preferred
Securities-Redemption;" and (iv) the entry of an order for the dissolution of
the Trust Issuer by a court of competent jurisdiction.
If an early dissolution occurs as described in clause (i), (ii) or (iv)
of the preceding paragraph, the Trust Issuer shall be liquidated by the Trust
Issuer Trustees as expeditiously as the Trust Issuer Trustees determine to be
possible by distributing, after satisfaction of liabilities to creditors of the
Trust Issuer, if any, as provided by applicable law, to the holders of the
Preferred Securities a Like Amount of the Junior Subordinated Debentures, unless
such distribution is determined by the Property Trustee not to be practical, in
which event such holders will be entitled to receive out of the assets of the
Trust Issuer available for distribution to holders, after satisfaction of
liabilities to creditors of the Trust Issuer, if any, as provided by applicable
law, an amount equal to, in the case of holders of the Preferred Securities, the
aggregate of the Liquidation Amount plus accrued and unpaid Distributions
thereon to the date of payment (such amount being the "Liquidation
Distribution"). If such Liquidation Distribution can be paid only in part
because the Trust Issuer has insufficient assets available to pay in full the
aggregate Liquidation Distribution, then the amounts payable directly by the
Trust Issuer on Preferred Securities shall be paid on a pro rata basis. The
Company, as the holder of the Common Securities, will be entitled to receive
distributions upon any such liquidation pro rata with the holders of the
Preferred Securities, except that if an event of default under the Indenture has
occurred and is continuing, the Preferred Securities shall have a priority over
the Common Securities with respect to any such distributions.
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EVENTS OF DEFAULT; NOTICE
Any one of the following events constitutes an "Event of Default" under
the Trust Agreement (an "Event of Default") with respect to the Preferred
Securities issued thereunder (whatever the reason for such Event of Default and
whether it shall be voluntary or involuntary or be effected by operation of law
or pursuant to any judgment, decree or order of any court or any order, rule or
regulation of any administrative or governmental body):
(i) the occurrence of an event of default under the
Indenture (see "Description of the Junior Subordinated
Debentures--Debenture Events of Default"); or
(ii) default in the payment of any Distribution when it
becomes due and payable, and continuation of such default for a period
of 30 days; or
(iii) default in the payment of any Redemption Price of any
Preferred Security when it becomes due and payable; or
(iv) default in the performance, or breach, in any material
respect, of any covenant or warranty of the Trust Issuer Trustees in
the Trust Agreement (other than a covenant or warranty a default in the
performance of which or the breach of which is dealt with in clause
(ii) or (iii) above), and continuation of such default or breach for a
period of 60 days after there has been given, by registered or
certified mail, to the defaulting Trust Issuer Trustee or Trustees by
the holders of at least 25% in aggregate Liquidation Amount of the
outstanding Preferred Securities, a written notice specifying such
default or breach and requiring it to be remedied and stating that such
notice is a "Notice of Default" under the Trust Agreement; or
(v) the occurrence of certain events of bankruptcy or
insolvency with respect to the Property Trustee and the failure by the
Company to appoint a successor Property Trustee within 60 days thereof.
Within 90 days after the occurrence of any Event of Default actually
known to the Property Trustee, the Property Trustee shall transmit notice of
such Event of Default to the holders of the Preferred Securities, the
Administrative Trustees and the Company, as depositor, unless such Event of
Default shall have been cured or waived. The Company, as depositor, and the
Administrative Trustees are required to file annually with the Property Trustee
a certificate as to whether or not they are in compliance with all the
conditions and covenants applicable to them under the Trust Agreement.
If an event of default under the Indenture has occurred and is
continuing, the Preferred Securities shall have a preference over the Common
Securities as described above. See "Description of the Preferred
Securities--Subordination of the Common Securities" and "-- Liquidation
Distribution Upon Dissolution". The existence of an event of default does not
entitle the holders of the Preferred Securities to accelerate the payment
thereof.
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REMOVAL OF THE TRUST ISSUER TRUSTEES
Unless an event of default under the Indenture shall have occurred and
be continuing, any Trust Issuer Trustee may be removed at any time by the holder
of the Common Securities. If an event of default under the Indenture has
occurred and is continuing, the Property Trustee and the Delaware Trustee may be
removed at such time by the holders of a majority in Liquidation Amount of the
outstanding Preferred Securities. In no event will the holders of the Preferred
Securities have the right to vote to appoint, remove or replace the
Administrative Trustees, which voting rights are vested exclusively in the
Company as the holder of the Common Securities. No resignation or removal of any
Trust Issuer Trustee and no appointment of a successor trustee shall be
effective until the acceptance of appointment by the successor trustee in
accordance with the provisions of the Trust Agreement.
CO-TRUSTEES AND SEPARATE PROPERTY TRUSTEE
Unless an Event of Default shall have occurred and be continuing, at
any time or times, for the purpose of meeting the legal requirements of the
Trust Indenture Act, if applicable, or of any jurisdiction in which any part of
the Trust Property (as defined in the Trust Agreement) may at the time be
located, the Company, as the holder of the Common Securities, shall have power
to appoint one or more persons either to act as a co-trustee, jointly with the
Property Trustee, of all or any part of such Trust Property, or to act as
separate trustee of any such property, in either case with such powers as may be
provided in the instrument of appointment, and to vest in such person or persons
in such capacity any property, title, right or power deemed necessary or
desirable, subject to the provisions of the Trust Agreement. In the event an
event of default under the Indenture has occurred and is continuing, the
Property Trustee alone shall have power to make such appointment.
MERGER OR CONSOLIDATION OF THE TRUST ISSUER TRUSTEES
Any entity into which the Property Trustee, the Delaware Trustee or any
Administrative Trustee that is not a natural person may be merged or converted
or with which it may be consolidated, or any entity resulting from any merger,
conversion or consolidation to which such Trustee shall be a party or any entity
succeeding to all or substantially all the corporate trust business of such
Trustee, shall be the successor of such Trustee under the Trust Agreement,
provided such entity shall be otherwise qualified and eligible.
MERGERS, CONSOLIDATIONS, AMALGAMATIONS OR REPLACEMENTS OF THE TRUST ISSUER
The Trust Issuer may not merge with or into, consolidate, amalgamate,
be replaced by, convey, transfer or lease its properties and assets
substantially as an entirety to any entity or other Person, except as described
below or as otherwise described in the Trust Agreement. The Trust Issuer may, at
the request of the Company, with the consent of the Administrative Trustees and
without the consent of the holders of the Preferred Securities, the Property
Trustee or the Delaware Trustee, merge with or into, consolidate, amalgamate, be
replaced by, convey, transfer
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or lease its properties and assets substantially as an entirety to, a trust
organized as such under the laws of any State: provided, that (i) such successor
entity either (a) expressly assumes all of the obligations of the Trust Issuer
with respect to the Preferred Securities or (b) substitutes for the Preferred
Securities other securities having substantially the same terms as the Preferred
Securities (the "Successor Securities") so long as the Successor Securities rank
the same as the Preferred Securities in priority with respect to Distributions
and payments upon liquidation, redemption and otherwise, (ii) the Company
expressly appoints a trustee of such successor entity possessing the same powers
and duties as the Property Trustee as the holder of the Junior Subordinated
Debentures, (iii) the Successor Securities are registered or listed, or any
Successor Securities will be registered or listed upon notification of issuance,
on any national securities exchange or other organization on which the Preferred
Securities are then registered or listed (including, if applicable, the Nasdaq
Stock Market's National Market), if any, (iv) such merger, consolidation,
amalgamation, replacement, conveyance, transfer or lease does not cause the
Preferred Securities (including any Successor Securities) to be downgraded by
any nationally recognized statistical rating organization, (v) such merger,
consolidation, amalgamation, replacement, conveyance, transfer or lease does not
adversely affect the rights, preferences and privileges of the holders of the
Preferred Securities (including any Successor Securities) in any material
respect, (vi) such successor entity has a purpose substantially identical to
that of the Trust Issuer, (vii) prior to such merger, consolidation,
amalgamation, replacement, conveyance, transfer or lease, the Company has
received an opinion from independent counsel to the Trust Issuer experienced in
such matters to the effect that (a) such merger, consolidation, amalgamation,
replacement, conveyance, transfer or lease does not adversely affect the rights,
preferences and privileges of the holders of the Preferred Securities (including
any Successor Securities) in any material respect and (b) following such merger,
consolidation, amalgamation, replacement, conveyance, transfer or lease, neither
the Trust Issuer nor such successor entity will be required to register as an
investment company under the Investment Company Act of 1940, as amended (the
"Investment Company Act") and (viii) the Company or any permitted successor or
assignee owns all of the common securities or its equivalent of such successor
entity and guarantees the obligations of such successor entity under the
Successor Securities at least to the extent provided by the Guarantee.
Notwithstanding the foregoing, the Trust Issuer shall not, except with the
consent of holders of 100% in Liquidation Amount of the Preferred Securities,
consolidate, amalgamate, merge with or into or be replaced by or convey,
transfer or lease its properties and assets substantially as an entirety to any
other entity or permit any other entity to consolidate, amalgamate, merge with
or into, or replace it if such consolidation, amalgamation, merger, replacement,
conveyance, transfer or lease would cause the Trust Issuer or the successor
entity to be classified as other than a grantor trust for United States federal
income tax purposes.
VOTING RIGHTS; AMENDMENT OF THE TRUST AGREEMENT
Except as provided below and under "Description of the
Guarantee--Amendments and Assignment" and as otherwise required by law and the
Trust Agreement, the holders of the Preferred Securities will have no voting
rights.
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The Trust Agreement may be amended from time to time by the Company,
the Property Trustee and the Administrative Trustees, without the consent of the
holders of the Preferred Securities, (i) with respect to acceptance of
appointment of a successor trustee, (ii) to cure any ambiguity, correct or
supplement any provisions in the Trust Agreement that may be inconsistent with
any other provision or to make any other provisions with respect to matters or
questions arising under the Trust Agreement, which shall not be inconsistent
with the other provisions of the Trust Agreement or (iii) to modify, eliminate
or add to any provisions of the Trust Agreement to such extent as shall be
necessary to ensure that the Trust Issuer will be classified for United States
federal income tax purposes as a grantor trust at all times that the Preferred
Securities are outstanding or to ensure that the Trust Issuer will not be
required to register as an "investment company" under the Investment Company
Act; provided, however, that in the case of clause (ii), such action shall not
adversely affect in any material respect the interests of any holder of the
Preferred Securities, and any such amendments of the Trust Agreement shall
become effective when notice thereof is given to the holders of the Preferred
Securities. The Trust Agreement may be amended by the Trust Issuer Trustees and
the Company with (i) the consent of holders representing not less than a
majority (based upon Liquidation Amounts) of the outstanding Preferred
Securities and (ii) receipt by the Trust Issuer Trustees of an opinion of
counsel to the effect that such amendment or the exercise of any power granted
to the Trust Issuer Trustees in accordance with such amendment will not affect
the Trust Issuer's status as a grantor trust for United States federal income
tax purposes or the Trust Issuer's exemption from status as an "investment
company" under the Investment Company Act, provided that without the consent of
each holder of the Preferred Securities, the Trust Agreement may not be amended
to (a) change the amount or timing of any Distribution on the Preferred
Securities or otherwise adversely affect the amount of any Distribution required
to be made in respect of the Preferred Securities as of a specified date or (b)
restrict the right of a holder of the Preferred Securities to institute suit for
the enforcement of any such payment on or after such date.
So long as the Junior Subordinated Debentures are held by the Property
Trustee, the Trust Issuer Trustees shall not (i) direct the time, method and
place of conducting any proceeding for any remedy available to the Debenture
Trustee or executing any trust or power conferred on the Property Trustee with
respect to the Junior Subordinated Debentures, (ii) waive any past default that
is waivable under the Indenture, (iii) exercise any right to rescind or annul a
declaration that the principal of all the Junior Subordinated Debentures shall
be due and payable or (iv) consent to any amendment, modification or termination
of the Indenture or the Junior Subordinated Debentures, where such consent shall
be required, without, in each case, obtaining the prior approval of the holders
of a majority in aggregate Liquidation Amount of all outstanding Preferred
Securities; provided, however, that where a consent under the Indenture would
require the consent of each holder of the Junior Subordinated Debentures
affected thereby, no such consent shall be given by the Property Trustee without
the prior consent of each holder of the Preferred Securities. The Trust Issuer
Trustees shall not revoke any action previously authorized or approved by a vote
of the holders of the Preferred Securities except by subsequent vote of the
holders of the Preferred Securities. The Property Trustee shall notify each
holder of the Preferred Securities of any notice of default with respect to the
Junior Subordinated Debentures. In addition to obtaining the foregoing approvals
of the holders of the Preferred Securities, prior to
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taking any of the foregoing actions, the Trust Issuer Trustees shall obtain an
opinion of counsel experienced in such matters to the effect that the Trust
Issuer will not be classified as an association taxable as a corporation for
United States federal income tax purposes on account of such action.
Any required approval of holders of the Preferred Securities may be
given at a meeting of holders of the Preferred Securities convened for such
purpose or pursuant to written consent. The Property Trustee will cause a notice
of any meeting at which holders of the Preferred Securities are entitled to
vote, or of any matter upon which action by written consent of such holders is
to be taken, to be given to each holder of record of the Preferred Securities in
the manner set forth in the Trust Agreement.
No vote or consent of the holders of the Preferred Securities will be
required for the Trust Issuer to redeem and cancel the Preferred Securities in
accordance with the Trust Agreement.
Notwithstanding that holders of the Preferred Securities are entitled
to vote or consent under any of the circumstances described above, any of the
Preferred Securities that are owned by the Company, the Trust Issuer Trustees or
any affiliate of the Company or the Trust Issuer Trustees shall, for purposes of
such vote or consent, be treated as if they were not outstanding.
LIQUIDATION VALUE
The amount payable on the Preferred Securities in the event of any
liquidation of the Trust Issuer is $10 per Preferred Security plus accumulated
and unpaid Distributions, which may be in the form of a distribution of such
amount in Junior Subordinated Debentures, subject to certain exceptions. See
"Description of the Preferred Securities --Liquidation Distribution Upon
Dissolution."
EXPENSES AND TAXES
In the Indenture, the Company, as borrower, has agreed to pay all debts
and other obligations (other than with respect to the Preferred Securities) and
all costs and expenses of the Trust Issuer (including costs and expenses
relating to the organization of the Trust Issuer, the fees and expenses of the
Trust Issuer Trustees and the costs and expenses relating to the operation of
the Trust Issuer) and to pay any and all taxes and all costs and expenses with
respect thereto (other than United States withholding taxes) to which the Trust
Issuer might become subject. The foregoing obligations of the Company under the
Indenture are for the benefit of, and shall be enforceable by, any person to
whom any such debts, obligations, costs, expenses and taxes are owed (a
"Creditor") whether or not such Creditor has received notice thereof. Any such
Creditor may enforce such obligations of the Company directly against the
Company, and the Company has irrevocably waived any right or remedy to require
that any such Creditor take any action against the Trust Issuer or any other
person before proceeding against the Company. The Company has also agreed in the
Indenture to execute such additional agreements as may be necessary or desirable
to give full effect to the foregoing.
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BOOK ENTRY, DELIVERY AND FORM
The Preferred Securities will be issued in the form of one or more
fully registered global securities which will be deposited with, or on behalf
of, DTC and registered in the name of DTC's nominee. Unless and until it is
exchangeable in whole on in part for the Preferred Securities in definitive
form, a global security may not be transferred except as a whole by DTC to a
nominee of DTC or by a nominee of DTC to DTC or another nominee of DTC or by DTC
or any such nominee to a successor of such Depository or a nominee of such
successor.
Ownership of beneficial interests in a global security will be limited
to persons that have accounts with DTC or its nominee ("Participants") or
persons that may hold interests through Participants. The Company expects that,
upon the issuance of a global security, DTC will credit, on its book-entry
registration and transfer system, the Participants' accounts with their
respective principal amounts of the Preferred Securities represented by such
global security. Ownership of beneficial interests in such global security will
be shown on, and the transfer of such ownership interests will be effected only
through, records maintained by DTC (with respect to interests of Participants)
and on the records of Participants (with respect to interests of Persons held
through Participants). Beneficial owners will not receive written confirmation
from DTC of their purchase, but are expected to receive written confirmations
from the Participants through which the beneficial owner entered into the
transaction. Transfers of ownership interests will be accomplished by entries on
the books of Participants acting on behalf of the beneficial owners.
So long as DTC, or its nominee, is the registered owner of a global
security, DTC or such nominee, as the case may be, will be considered the sole
owner or holder of the Preferred Securities represented by such global security
for all purposes under the Trust Agreement. Except as provided below, owners of
beneficial interests in a global security will not be entitled to receive
physical delivery of the Preferred Securities in definitive form and will not be
considered the owners or holders thereof under the Trust Agreement. Accordingly,
each person owning a beneficial interest in such a global security must rely on
the procedures of DTC and, if such person is not a Participant, on the
procedures of the Participant through which such person owns its interest, to
exercise any rights of a holder of Preferred Securities under the Trust
Agreement. The Company understands that, under DTC's existing practices, in the
event that the Company requests any action of holders, or an owner of a
beneficial interest in such a global security desires to take any action which a
holder is entitled to take under the Trust Agreement, DTC would authorize the
Participants holding the relevant beneficial interests to take such action, and
such Participants would authorize beneficial owners owning through such
Participants to take such action or would otherwise act upon the instructions of
beneficial owners owning through them. Redemption notices will also be sent to
DTC. If less than all of the Preferred Securities are being redeemed, the
Company understands that it is DTC's existing practice to determine by lot the
amount of the interest of each Participant to be redeemed.
Distributions on the Preferred Securities registered in the name of DTC
or its nominee will be made to DTC or its nominee, as the case may be, as the
registered owner of the global security representing such Preferred Securities.
None of the Company, the Trust Issuer Trustees,
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any Paying Agent or any other agent of the Company or the Trust Issuer Trustees
will have any responsibility or liability for any aspect of the records relating
to or payments made on account of beneficial ownership interests in the global
security for such Preferred Securities or for maintaining, supervising or
reviewing any records relating to such beneficial ownership interests.
Disbursements of Distributions to Participants shall be the responsibility of
DTC. DTC's practice is to credit Participants' accounts on a payable date in
accordance with their respective holdings shown on DTC's records unless DTC has
reason to believe that it will not receive payment on the payable date. Payments
by Participants to beneficial owners will be governed by standing instructions
and customary practices, as is the case with securities held for the accounts of
customers in bearer form or registered in "street name," and will be the
responsibility of such Participant and not of DTC, the Company, the Trust Issuer
Trustees, the Paying Agent or any other agent of the Company or Trust Issuer,
subject to any statutory or regulatory requirements as may be in effect from
time to time.
DTC may discontinue providing its services as securities depository
with respect to the Preferred Securities at any time by giving reasonable notice
to the Company or the Trust Issuer Trustees. If DTC notifies the Company that it
is unwilling to continue as such, or if it is unable to continue or ceases to be
a clearing agency registered under the Exchange Act and a successor depository
is not appointed by the Company within ninety days after receiving such notice
or becoming aware that DTC is no longer so registered, the Company will issue
the Preferred Securities in definitive form upon registration of transfer of, or
in exchange for, such global security. In addition, the Company may at any time
and in its sole discretion determine not to have the Preferred Securities
represented by one or more global securities and, in such event, will issue
Preferred Securities in definitive form in exchange for all of the global
securities representing such Preferred Securities.
DTC has advised the Company and the Trust Issuer as follows: DTC is a
limited purpose trust company organized under the laws of the State of New York,
a member of the Federal Reserve System, a "clearing corporation" within the
meaning of the Uniform Commercial Code of the state of New York and a "clearing
agency" registered pursuant to the provisions of Section 17A of the Exchange
Act. DTC was created to hold securities for its Participants and to facilitate
the clearance and settlement of securities transactions between Participants
through electronic book entry changes to accounts of its Participants, thereby
eliminating the need for physical movement of certificates. Participants include
securities brokers and dealers, banks, trust companies and clearing corporations
and may include certain other organizations. Certain of such Participants (or
their representatives), together with other entities, own DTC. Indirect access
to the DTC system is available to others such as banks, brokers, dealers and
trust companies that clear through, or maintain a custodial relationship with, a
Participant, either directly or indirectly.
SAME-DAY SETTLEMENT AND PAYMENT
Settlement for the Preferred Securities will be made by the Underwriter
in immediately available funds.
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Secondary trading in preferred securities of corporate issuers is
generally settled in clearinghouse or next-day funds. In contrast, the Preferred
Securities will trade in DTC's Same- Day Funds Settlement System, and secondary
market trading activity in the Preferred Securities will therefore be required
by DTC to settle in immediately available funds. No assurance can be given as to
the effect, if any, of settlement in immediately available funds on trading
activity in the Preferred Securities.
PAYMENT AND PAYING AGENCY
Payments in respect of the Preferred Securities will be made to DTC,
which will credit the relevant accounts at DTC on the applicable Distribution
Dates or, if the Preferred Securities are not held by DTC, such payments will be
made by check mailed to the address of the holder entitled thereto, as such
address appears on the securities register for the Trust Securities. The paying
agent (the "Paying Agent") will initially be the Property Trustee and any
co-paying agent chosen by the Property Trustee and acceptable to the
Administrative Trustees and the Company. The Paying Agent will be permitted to
resign as Paying Agent upon 30 days' written notice to the Property Trustee and
the Administrative Trustees. If the Property Trustee is no longer the Paying
Agent, the Property Trustee will appoint a successor (which must be a bank or
trust company reasonably acceptable to the Administrative Trustees) to act as
Paying Agent.
REGISTRAR AND TRANSFER AGENT
The Property Trustee will act as the registrar and the transfer agent
for the Preferred Securities. Registration of transfers of Preferred Securities
will be effected without charge by or on behalf of the Trust Issuer, except for
the payment of any tax or other governmental charges that may be imposed in
connection with any transfer or exchange. In the event of any redemption, the
Trust Issuer will not be required to (i) issue, register the transfer of, or
exchange any Preferred Securities during a period beginning at the opening of
business 15 days before the date of mailing of a notice of redemption of any
Preferred Securities called for redemption and ending at the close of business
on the day of such mailing; or (ii) register the transfer of or exchange any
Preferred Securities so selected for redemption, in whole or in part, except the
unredeemed portion of any such Preferred Securities being redeemed in part.
INFORMATION CONCERNING THE PROPERTY TRUSTEE
The Property Trustee, other than upon the occurrence and during the
continuance of an Event of Default, undertakes to perform only such duties as
are specifically set forth in the Trust Agreement and, after such Event of
Default, must exercise the same degree of care and skill as a prudent person
would exercise or use in the conduct of his or her own affairs. Subject to this
provision, the Property Trustee is under no obligation to exercise any of the
powers vested in it by the Trust Agreement at the request of any holder of
Preferred Securities unless it is offered reasonable indemnity against the
costs, expenses and liabilities that might be incurred thereby. If no Event of
Default has occurred and is continuing and the Property Trustee is required to
decide between alternative causes of action, construe ambiguous provisions in
the Trust
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Agreement or is unsure of the application of any provision of the Trust
Agreement, and the matter is not one on which holders of Preferred Securities
are entitled under the Trust Agreement to vote, then the Property Trustee will
take such action as it deems advisable and in the best interests of the holders
of the Preferred Securities and will have no liability except for its own bad
faith, negligence or willful misconduct.
MISCELLANEOUS
The Administrative Trustees are authorized and directed to conduct the
affairs of and to operate the Trust Issuer in such a way that the Trust Issuer
will not be deemed to be an "investment company" required to be registered under
the Investment Company Act or classified as an association taxable as a
corporation for United States federal income tax purposes and so that the Junior
Subordinated Debentures will be treated as indebtedness of the Company for
United States federal income tax purposes. In this connection, the Company and
the Administrative Trustees are authorized to take any action, not inconsistent
with applicable law, the certificate of trust of the Trust Issuer or the Trust
Agreement, that the Company and the Administrative Trustees determine in their
discretion to be necessary or desirable for such purposes.
Holders of the Preferred Securities have no preemptive or similar
rights.
The Trust Agreement and the Preferred Securities will be governed by,
and construed in accordance with, the laws of the State of Delaware.
DESCRIPTION OF THE JUNIOR SUBORDINATED DEBENTURES
The Junior Subordinated Debentures are to be issued under an Indenture
(the "Indenture") between the Company and The Bank of New York, as trustee (the
"Debenture Trustee"). The Indenture will be qualified as an indenture under the
Trust Indenture Act. This summary of certain terms and provisions of the Junior
Subordinated Debentures and the Indenture does not purport to be complete and is
subject to, and is qualified in its entirety by reference to, the Indenture, and
to the Trust Indenture Act. Wherever particular defined terms of the Indenture
are referred to, but not defined herein, such defined terms are incorporated
herein by reference. The form of the Indenture has been filed as an exhibit to
the Registration Statement of which this Prospectus forms a part.
GENERAL
Concurrently with the issuance of the Preferred Securities, the Trust
Issuer will invest the proceeds thereof, together with the consideration paid by
the Company for the Common Securities, in the Junior Subordinated Debentures.
The Junior Subordinated Debentures will bear interest at the annual rate of
___%, payable quarterly in arrears on March 1, June 1, September 1 and December
1 of each year (each, an "Interest Payment Date"), commencing ________, 1998,
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to the person in whose name each Junior Subordinated Debenture is registered,
subject to certain exceptions, at the close of business on the Business Day next
preceding such Interest Payment Date. It is anticipated that, until the
liquidation, if any, of the Trust Issuer, the Junior Subordinated Debentures
will be held in the name of the Property Trustee in trust for the benefit of the
holders of the Preferred Securities. The amount of interest payable for any
period will be computed on the basis of a 360-day year of twelve 30-day months.
In the event that any date on which interest is payable on the Junior
Subordinated Debentures is not a Business Day, then payment of the interest
payable on such date will be made on the next succeeding day that is a Business
Day (and without any interest or other payment in respect of any such delay),
except that, if such Business Day is in the next succeeding calendar year, such
payment shall be made on the immediately preceding Business Day, in each case
with the same force and effect as if made on the date such payment was
originally payable. Accrued interest that is not paid on the applicable Interest
Payment Date will bear additional interest on the amount thereof (to the extent
permitted by law) at the rate per annum of ___% thereof, compounded quarterly
from the relevant Interest Payment Date. The term "interest" as used herein
shall include quarterly interest payments, interest on quarterly interest
payments not paid on the applicable Interest Payment Date and Additional
Interest (as defined below), as applicable.
The Junior Subordinated Debentures will mature on ________, 2028 (the
"Stated Maturity").
The Junior Subordinated Debentures will be unsecured and will rank
junior and be subordinate in right of payment to all Senior Debt and
Subordinated Debt (collectively "Senior Indebtedness") of the Company. Because
the Company is a holding company, the right of the Company to participate in any
distribution of assets of any subsidiary, including the Bank, upon such
subsidiary's liquidation or reorganization or otherwise, is subject to the prior
claims of creditors of that subsidiary, except to the extent that the Company
may itself be recognized as a creditor of that subsidiary. Accordingly, the
Junior Subordinated Debentures will be effectively subordinated to all existing
and future liabilities of the Company's subsidiaries, and holders of the Junior
Subordinated Debentures should look only to the assets of the Company for
payments on the Junior Subordinated Debentures. The Indenture does not limit the
incurrence or issuance of other secured or unsecured debt of the Company,
including Senior Indebtedness, whether under the Indenture or any existing or
other indenture that the Company may enter into in the future or otherwise.
RIGHT TO DEFER INTEREST PAYMENT OBLIGATION
So long as no event of default under the Indenture has occurred and is
continuing, the Company has the right under the Indenture at any time or from
time to time during the term of the Junior Subordinated Debentures to defer the
payment of interest on the Junior Subordinated Debentures for a period not
exceeding 20 consecutive quarters with respect to each Extension Period,
provided that no Extension Period may extend beyond the Stated Maturity of the
Junior Subordinated Debentures. At the end of each Extension Period, the Company
must pay all interest then accrued and unpaid on the Junior Subordinated
Debentures (together with interest
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on such unpaid interest at the annual rate of ___%, compounded quarterly from
the relevant Interest Payment Date, to the extent permitted by applicable law,
referred to herein as "Compounded Interest"). During an Extension Period,
interest would continue to accrue and holders of the Junior Subordinated
Debentures would be required to accrue interest income for United States federal
income tax purposes. See "Certain Federal Income Tax Consequences-- Interest
Income and Original Issue Discount."
During any such Extension Period, the Company may not, and may not
permit any subsidiary of the Company to, (i) declare or pay any dividends or
distributions on, or redeem, purchase, acquire or make a liquidation payment
with respect to, any of the Company's capital stock (other than (a) the
reclassification of any class of the Company's capital stock into another class
of capital stock, (b) dividends or distributions in common stock of the Company,
(c) any declaration of a dividend in connection with the implementation of a
stockholders' rights plan, the issuance of stock under any such plan in the
future or the redemption or repurchase of any such rights pursuant thereto, (d)
payments under the Guarantee and (e) purchases of common stock related to the
issuance of common stock or rights under any of the Company's benefit plans for
its directors, officers or employees) or (ii) make any payment of principal,
interest or premium, if any, on or repay, repurchase or redeem any debt
securities of the Company that rank pari passu with or junior in interest to the
Junior Subordinated Debentures or make any guarantee payments with respect to
any guarantee by the Company of the debt securities of any subsidiary of the
Company if such guarantee ranks pari passu with or junior in interest to the
Junior Subordinated Debentures other than payments pursuant to the Guarantee;
and (iii) the Company shall not redeem, purchase or acquire less than all the
outstanding Junior Subordinated Debentures or any of the Preferred Securities.
Prior to the termination of any such Extension Period, the Company may further
defer the payment of interest, provided that no Extension Period may exceed 20
consecutive quarters or extend beyond the Stated Maturity of the Junior
Subordinated Debentures. Upon the termination of any such Extension Period and
the payment of all interest then accrued and unpaid (together with interest
thereon at the rate of ___%, compounded quarterly, to the extent permitted by
applicable law), the Company may elect to begin a new Extension Period subject
to the above requirements. No interest shall be due and payable during an
Extension Period, except at the end thereof. The Company must give the Property
Trustee, the Administrative Trustees and the Debenture Trustee notice of its
election of such Extension Period at least one Business Day prior to the earlier
of (i) the date interest on the Junior Subordinated Debentures would have been
payable except for the election to begin such Extension Period or (ii) the date
the Administrative Trustees are required to give notice of the record date, or
the date such Distributions are payable, to the Nasdaq Stock Market's National
Market or other applicable self-regulatory organization or to holders of the
Preferred Securities as of the record date or the date such Distributions are
payable, but in any event not less than one Business Day prior to such record
date. The Debenture Trustee shall give notice of the Company's election to begin
a new Extension Period to the holders of the Preferred Securities. There is no
limitation on the number of times that the Company may elect to begin an
Extension Period.
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ADDITIONAL INTEREST
If the Trust Issuer or the Property Trustee is required to pay any
additional taxes, duties or other governmental charges as a result of a Tax
Event, the Company will pay such additional amounts (the "Additional Sums") on
the Junior Subordinated Debentures as shall be required so that the
Distributions payable by the Trust Issuer shall not be reduced as a result of
any such additional taxes, duties or other governmental charges.
REDEMPTION OR EXCHANGE
The Company will have the right to redeem the Junior Subordinated
Debentures prior to maturity (i) on or after _______, 2003, in whole at any time
or in part from time to time, or (ii) at any time in whole (but not in part),
within 180 days following the occurrence of a Tax Event, an Investment Company
Event or a Capital Treatment Event, in each case at a redemption price equal to
the accrued and unpaid interest on the Junior Subordinated Debentures so
redeemed to the date fixed for redemption, plus 100% of the principal amount
thereof. Any such redemption prior to the Stated Maturity will be subject to
prior regulatory approval if then required.
"Investment Company Event" means the receipt by the Trust Issuer of an
Opinion of Counsel to the effect that, as a result of the occurrence of a change
in law or regulation or a change in interpretation or application of law or
regulation by any legislative body, court, governmental agency or regulatory
authority, the Trust Issuer is or will be considered an "investment company"
that is required to be registered under the Investment Company Act, which change
becomes effective on or after the date of original issuance of the Preferred
Securities.
"Capital Treatment Event" means the receipt by the Trust Issuer of an
Opinion of Counsel to the effect that, as a result of any amendment to, or
change (including any proposed change) in, the laws (or any regulations
thereunder) of the United States or any political subdivision thereof or
therein, or as a result of any official or administrative pronouncement or
action or judicial decision interpreting or applying such laws or regulations,
which amendment or change is effective or such proposed change, pronouncement,
action or decision is announced on or after the date of original issuance of the
Preferred Securities, there is more than an insubstantial risk that the
Preferred Securities would not constitute Tier 1 Capital (or the then equivalent
thereof) applied as if the Company (or its successor) were a bank holding
company for purposes of the capital adequacy guidelines of the Federal Reserve
(or any successor regulatory authority with jurisdiction over bank holding
companies), or any capital adequacy guidelines as then in effect and applicable
to the Company. There are currently no capital adequacy guidelines applicable to
savings bank holding companies such as the Company.
The Junior Subordinated Debentures will not be subject to any sinking
fund.
"Tax Event" means the receipt by the Trust Issuer of an Opinion of
Counsel to the effect that, as a result of any amendment to, or change
(including any announced prospective change) in, the laws (or any regulations
thereunder) of the United States or any political subdivision or
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taxing authority thereof or therein, or as a result of any official
administrative pronouncement or judicial decision interpreting or applying such
laws or regulations, which amendment or change is effective or which
pronouncement or decision is announced on or after the date of issuance of the
Preferred Securities under the Trust Agreement, there is more than an
insubstantial risk that (i) the Trust Issuer is, or will be within 90 days of
the date of such opinion, subject to United Stated federal income tax with
respect to income received or accrued on the Junior Subordinated Debentures,
(ii) interest payable by the Company on the Junior Subordinated Debentures is
not, or within 90 days of the date of such opinion will not be, deductible by
the Company, in whole or in part, for United States federal income tax purposes
or (iii) the Trust Issuer is, or will be within 90 days of the date of such
opinion, subject to more than a de minimis amount of other taxes, duties or
other governmental charges.
"Opinion of Counsel" means an opinion in writing of independent legal
counsel experienced in such matters as being opined upon, that is delivered to
the Trust Issuer Trustees.
"Additional Interest" means the additional amounts as may be necessary
in order that the amount of Distributions then due and payable by the Trust
Issuer on the outstanding Preferred Securities and Common Securities shall not
be reduced as a result of any additional taxes, duties and other governmental
charges to which the Trust Issuer has become subject as a result of a Tax Event.
"Like Amount" means (i) with respect to a redemption of the Preferred
Securities, Preferred Securities having a Liquidation Amount equal to that
portion of the principal amount of the Junior Subordinated Debentures to be
contemporaneously redeemed in accordance with the Indenture, allocated to the
Common Securities and to the Preferred Securities pro rata based upon the
relative Liquidation Amounts of such Preferred Securities and Common Securities
and the proceeds of which will be used to pay the Redemption Price of such
Preferred Securities and Common Securities and (ii) with respect to a
distribution of the Junior Subordinated Debentures to holders of the Preferred
Securities in exchange therefor in connection with a dissolution or liquidation
of the Trust Issuer, Junior Subordinated Debentures having a principal amount
equal to the Liquidation Amount of the Preferred Securities of the holder to
whom such Junior Subordinated Debentures would be distributed.
Notice of any redemption will be mailed at least 30 days but not more
than 60 days before the redemption date to each Holder of the Junior
Subordinated Debentures to be redeemed at its registered address. Unless the
Company defaults in payment of the redemption price, on and after the redemption
date interest ceases to accrue on the Junior Subordinated Debentures or portions
thereof called for redemption.
REGISTRATION, DENOMINATION AND TRANSFER
The Junior Subordinated Debentures will initially be registered in the
name of the Property Trustee. If the Junior Subordinated Debentures are
distributed to holders of Preferred Securities, it is anticipated that the
depository arrangements for the Junior Subordinated
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Debentures will be substantially identical to those in effect for the Preferred
Securities. See "Description of Preferred Securities -- Book Entry, Delivery and
Form."
Although DTC has agreed to the procedures described above, it is under
no obligation to perform or continue to perform such procedures, and such
procedures may be discontinued at any time. If DTC is at any time unwilling or
unable to continue as depositary and a successor depositary is not appointed by
the Company within 90 days of receipt of notice from DTC to such effect, the
Company will cause the Junior Subordinated Debentures to be issued in definitive
form.
Payments on Junior Subordinated Debentures represented by a global
security will be made to Cede & Co., the nominee for DTC, as the registered
holder of the Junior Subordinated Debentures, as described under "Description of
Preferred Securities -- Book Entry, Delivery and Form." If Junior Subordinated
Debentures are issued in certificated form, principal and interest will be
payable, the transfer of the Junior Subordinated Debentures will be registrable,
and Junior Subordinated Debentures will be exchangeable for Junior Subordinated
Debentures of other authorized denominations of a like aggregate principal
amount, at the corporate trust office of the Debenture Trustee in New York, New
York or at the offices of any paying agent or transfer agent appointed by the
Company, provided that payment of interest may be made at the option of the
Company by check mailed to the address of the persons entitled thereto. However,
a holder of $1 million or more in aggregate principal amount of Junior
Subordinated Debentures may receive payments of interest (other than interest
payable at the Stated Maturity) by wire transfer of immediately available funds
upon written request to the Debenture Trustee not later than 15 calendar days
prior to the date on which the interest is payable.
Junior Subordinated Debentures will be exchangeable for other Junior
Subordinated Debentures of like tenor, of any authorized denominations and of a
like aggregate principal amount.
Junior Subordinated Debentures may be presented for exchange as
provided above, and may be presented for registration of transfer (with the form
of transfer endorsed thereon, or a satisfactory written instrument of transfer,
duly executed), at the office of the securities registrar appointed under the
Indenture or at the office of any transfer agent designated by the Company for
such purpose without service charge and upon payment of any taxes and other
governmental charges as described in the Indenture. The Company will appoint the
Debenture Trustee as securities registrar under the Indenture. The Company may
at any time designate additional transfer agents with respect to the Junior
Subordinated Debentures.
In the event of any redemption, neither the Company nor the Debenture
Trustee shall be required to (i) issue, register the transfer of or exchange
Junior Subordinated Debentures during a period beginning at the opening of
business 15 days before the day of selection for redemption of the Junior
Subordinated Debentures to be redeemed and ending at the close of business on
the day of mailing of the relevant notice of redemption or (ii) transfer or
exchange any Junior
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Subordinated Debentures so selected for redemption, except, in the case of any
Junior Subordinated Debentures being redeemed in part, any portion thereof not
to be redeemed.
Any monies deposited with the Debenture Trustee or any paying agent, or
then held by the Company in trust, for the payment of the principal of (and
premium, if any) or interest on any Junior Subordinated Debenture and remaining
unclaimed for two years after such principal (and premium, if any) or interest
has become due and payable shall, at the request of the Company, be repaid to
the Company and the holder of such Junior Subordinated Debenture shall
thereafter look, as a general unsecured creditor, only to the Company for
payment thereof.
RESTRICTIONS ON CERTAIN PAYMENTS
The Company will also covenant, as to the Junior Subordinated
Debentures, that it will not, and will not permit any subsidiary of the Company
to, (i) declare or pay any dividends or distributions on, or redeem, purchase,
acquire or make a liquidation payment with respect to, any of the Company's
capital stock (other than (a) the reclassification of any class of the Company's
capital stock into another class of capital stock, (b) dividends or
distributions in common stock of the Company, (c) any declaration of a dividend
in connection with the implementation of a stockholders' rights plan, the
issuance of stock under any such plan in the future or the redemption or
repurchase of any such rights pursuant thereto, (d) payments under the Guarantee
and (e) purchases of common stock related to the issuance of common stock or
rights under any of the Company's benefit plans for its directors, officers or
employees), (ii) make any payment of principal, interest or premium, if any, on
or repay or repurchase or redeem any debt securities of the Company that rank
pari passu with or junior in interest to the Junior Subordinated Debentures
other than payments pursuant to the Guarantee or (iii) the Company shall not
redeem, purchase or acquire less than all the outstanding Junior Subordinated
Debentures or any of the Preferred Securities if at such time (i) there shall
have occurred an Event of Default under the Indenture with respect to the Junior
Subordinated Debentures, (ii) if the Junior Subordinated Debentures are held by
the Trust Issuer, the Company shall be in default with respect to its payment of
any obligations under the Guarantee relating to such Preferred Securities or
(iii) the Company shall have given notice of its selection of an Extension
Period as provided in the Indenture with respect to the Junior Subordinated
Debentures and shall not have rescinded such notice, or such Extension Period,
or any extension thereof, shall be continuing.
MODIFICATION OF INDENTURE
From time to time the Company and the Debenture Trustee may, without
the consent of the holders of the Junior Subordinated Debentures, amend, waive
or supplement the Indenture for specified purposes, including, among other
things, curing ambiguities, defects or inconsistencies, provided that any such
action does not materially adversely affect the interest of the holders of the
Junior Subordinated Debentures or the ability to qualify, or maintain the
qualification of, the Indenture under the Trust Indenture Act. The Indenture
contains provisions permitting the Company and the Debenture Trustee, with the
consent of the holders of not less than a majority in principal amount of the
Junior Subordinated Debentures affected, to modify
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the Indenture in a manner affecting the rights of the holders of the Junior
Subordinated Debentures, provided that no such modification may, without the
consent of the holder of each outstanding Junior Subordinated Debenture so
affected, (i) extend the Stated Maturity of the Junior Subordinated Debentures,
reduce the principal amount thereof or reduce the rate or extend the time of
payment of interest thereon or (ii) reduce the percentage of principal amount of
the Junior Subordinated Debentures, the holders of which are required to consent
to any such modification of the Indenture.
DEBENTURE EVENTS OF DEFAULT
The Indenture provides that any one or more of the following described
events with respect to the Junior Subordinated Debentures that has occurred and
is continuing constitutes a "Debenture Event of Default":
(i) failure for 30 days to pay interest (including
Additional Interest or Compounded Interest, if any) on the Junior
Subordinated Debentures when due (subject to the deferral of certain
due dates in the case of an Extension Period); or
(ii) failure to pay any principal on the Junior Subordinated
Debentures when due, whether at maturity, upon declaration of
acceleration of maturity or otherwise; or
(iii) failure to observe or perform certain other covenants
contained in the Indenture for 90 days after written notice to the
Company from the Debenture Trustee or the holders of at least 25% in
aggregate outstanding principal amount of the outstanding Junior
Subordinated Debentures; or
(iv) certain events in bankruptcy, insolvency or
reorganization of the Company, subject in certain instances to any such
event remaining in effect for a period of 60 consecutive days.
The holders of a majority in aggregate outstanding principal amount of
the Junior Subordinated Debentures have the right to direct the time, method and
place of conducting any proceeding for any remedy available to the Debenture
Trustee. The Debenture Trustee or the holders of not less than 25% in aggregate
outstanding principal amount of the Junior Subordinated Debentures may declare
the principal due and payable immediately upon a Debenture Event of Default. The
holders of a majority in aggregate outstanding principal amount of the Junior
Subordinated Debentures may annul such declaration and waive the default if the
default (other than the non-payment of the principal of the Junior Subordinated
Debentures which has become due solely by such acceleration) has been cured and
a sum sufficient to pay all matured installments of interest and principal due
otherwise than by acceleration has been deposited with the Debenture Trustee.
The holders of a majority in aggregate outstanding principal amount of
the Junior Subordinated Debentures affected thereby may, on behalf of the
holders of all the Junior
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Subordinated Debentures, waive any past default, except a default in the payment
of principal or interest (unless such default has been cured and a sum
sufficient to pay all matured installments of interest and principal due
otherwise than by acceleration has been deposited with the Debenture Trustee) or
a default in respect of a covenant or provision which under the Indenture cannot
be modified or amended without the consent of the holder of each outstanding
Junior Subordinated Debenture. The Company is required to file annually with the
Debenture Trustee a certificate as to whether or not the Company is in
compliance with all the conditions and covenants applicable to it under the
Indenture.
ENFORCEMENT OF CERTAIN RIGHTS BY HOLDERS OF THE PREFERRED SECURITIES
If a Debenture Event of Default has occurred and is continuing and such
event is attributable to the failure of the Company to pay interest or principal
on the Junior Subordinated Debentures on the date such interest or principal is
otherwise payable, a holder of the Preferred Securities may institute a legal
proceeding directly against the Company for enforcement of payment to such
holder of the principal of or interest on the Junior Subordinated Debentures
having a principal amount equal to the aggregate Liquidation Amount of the
Preferred Securities of such holder (a "Direct Action"). The Company may not
amend the Indenture to remove the foregoing right to bring a Direct Action
without the prior written consent of the holders of all of the Preferred
Securities. If the right to bring a Direct Action is removed, the Trust Issuer
may become subject to the reporting obligations under the Exchange Act. The
Company shall have the right under the Indenture to set-off any payment made to
such holder of the Preferred Securities by the Company in connection with a
Direct Action.
The holders of the Preferred Securities will not be able to exercise
directly any remedies other than those set forth in the preceding paragraph
available to the holders of the Junior Subordinated Debentures. See "Description
of the Preferred Securities--Events of Default; Notice."
CONSOLIDATION, MERGER, SALE OF ASSETS AND OTHER TRANSACTIONS
The Indenture provides that the Company shall not consolidate with or
merge into any other entity or convey, transfer or lease its properties and
assets substantially as an entirety to any entity, and no entity shall
consolidate with or merge into the Company or convey, transfer or lease its
properties and assets substantially as an entirety to the Company, unless: (i)
in the event the Company consolidates with or merges into another entity or
conveys or transfers its properties and assets substantially as an entirety to
any entity, the successor entity is organized under the laws of the United
States or any state or the District of Columbia, and such successor entity
expressly assumes the Company's obligations on the Junior Subordinated
Debentures issued under the Indenture; (ii) immediately after giving effect
thereto, no Debenture Event of Default, and no event which, after notice or
lapse of time or both, would become a Debenture Event of Default, shall have
occurred and be continuing; and (iii) certain other conditions as prescribed by
the Indenture are met.
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The general provisions of the Indenture do not afford holders of the
Junior Subordinated Debentures protection in the event of a highly leveraged or
other transaction involving the Company that may adversely affect holders of the
Junior Subordinated Debentures.
SATISFACTION AND DISCHARGE
The Indenture provides that when, among other things, all of the Junior
Subordinated Debentures not previously delivered to the Debenture Trustee for
cancellation (i) have become due and payable or (ii) will become due and payable
at their Stated Maturity within one year, and the Company deposits or causes to
be deposited with the Debenture Trustee funds, in trust, for the purpose and in
an amount in the currency or currencies in which the Junior Subordinated
Debentures are payable sufficient to pay and discharge the entire indebtedness
on the Junior Subordinated Debentures not previously delivered to the Debenture
Trustee for cancellation, for the principal and interest to the date of the
deposit or to the Stated Maturity, as the case may be, then the Indenture will
cease to be of further effect (except as to the Company's obligations to pay all
other sums due pursuant to the Indenture and to provide the officers'
certificates and opinions of counsel described therein), and the Company will be
deemed to have satisfied and discharged the Indenture.
SUBORDINATION
In the Indenture, the Company has covenanted and agreed that the Junior
Subordinated Debentures issued thereunder will be subordinate and junior in
right of payment to all Senior Indebtedness to the extent provided in the
Indenture. Upon any payment or distribution of assets to creditors upon the
liquidation, dissolution, winding-up, reorganization, assignment for the benefit
of creditors, marshaling of assets or any bankruptcy, insolvency, debt
restructuring or similar proceedings in connection with any insolvency or
bankruptcy proceeding of the Company, the holders of Senior Indebtedness will
first be entitled to receive payment in full of principal of (and premium, if
any) and interest, if any, on such Senior Indebtedness before the holders of the
Junior Subordinated Debentures, or the Property Trustee on behalf of the
holders, will be entitled to receive or retain any payment in respect of the
principal of or interest, if any, on the Junior Subordinated Debentures.
In the event of the acceleration of the maturity of any of the Junior
Subordinated Debentures, the holders of all Senior Indebtedness outstanding at
the time of such acceleration will first be entitled to receive payment in full
of all amounts due thereon (including any amounts due upon acceleration) before
the holders of the Junior Subordinated Debentures will be entitled to receive or
retain any payment in respect of the principal of or interest, if any, on the
Junior Subordinated Debentures.
No payments on account of principal or interest, if any, in respect of
the Junior Subordinated Debentures may be made if there shall have occurred and
be continuing a default in any payment with respect to Senior Indebtedness or an
event of default with respect to any
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Senior Indebtedness resulting in the acceleration of the maturity thereof, or if
any judicial proceeding shall be pending with respect to any such default.
"Debt" means with respect to any Person, whether recourse is to all or
a portion of the assets of such Person and whether or not contingent: (i) every
obligation of such Person for money borrowed; (ii) every obligation of such
Person evidenced by bonds, debentures, notes or other similar instruments,
including obligations incurred in connection with the acquisition of property,
assets or businesses; (iii) every reimbursement obligation of such Person with
respect to letters of credit, bankers' acceptances or similar facilities issued
for the account of such Person; (iv) every obligation of such Person issued or
assumed as the deferred purchase price of property or services (but excluding
trade accounts payable or accrued liabilities arising in the ordinary course of
business); (v) every capital lease obligation of such Person; (vi) all
indebtedness of such Person whether incurred on or prior to the date of the
Indenture or thereafter incurred, for claims in respect of derivative products,
including interest rate, foreign exchange rate and commodity forward contracts,
options and swaps and similar arrangements; and (vii) every obligation of the
type referred to in clauses (i) through (vi) of another Person and all dividends
of another Person the payment of which, in either case, such Person has
guaranteed or is responsible or liable, directly or indirectly, as obligor or
otherwise.
"Senior Debt" means the principal of (and premium, if any) and
interest, if any (including interest accruing on or after the filing of any
petition in bankruptcy or for reorganization relating to the Company whether or
not such claim for post-petition interest is allowed in such proceeding), on
Debt, whether incurred on or prior to the date of the Indenture or thereafter
incurred, unless, in the instrument creating or evidencing the same or pursuant
to which the same is outstanding, it is provided that such obligations are not
superior in right of payment to the Junior Subordinated Debentures or to other
Debt which is pari passu with, or subordinated to, the Junior Subordinated
Debentures; provided, however, that Senior Debt shall not be deemed to include:
(i) any Debt of the Company which when incurred and without respect to any
election under Section 1111(b) of the United States Bankruptcy Code of 1978, as
amended, was without recourse to the Company, (ii) any Debt of the Company to
any of its subsidiaries, and (iii) any Debt to any employee of the Company.
"Subordinated Debt" means the principal of (and premium, if any) and
interest, if any (including interest accruing on or after the filing of any
petition in bankruptcy or for reorganization relating to the Company whether or
not such claim for post-petition interest is allowed in such proceeding), on
Debt, whether incurred on or prior to the date of the Indenture or thereafter
incurred, which is by its terms expressly provided to be junior and subordinate
to other Debt of the Company (other than the Junior Subordinated Debentures),
except that Subordinated Debt shall not include debentures sold by the Company
to the Trust Issuer.
The Indenture places no limitation on the amount of Senior Indebtedness
that may be incurred by the Company. The Company may from time to time incur
indebtedness constituting Senior Indebtedness.
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GOVERNING LAW
The Indenture and the Junior Subordinated Debentures will be governed
by and construed in accordance with the laws of the State of New York, without
regard to conflicts of laws principles thereof.
INFORMATION CONCERNING THE DEBENTURE TRUSTEE
The Debenture Trustee shall have and be subject to all the duties and
responsibilities specified with respect to an indenture trustee under the Trust
Indenture Act. Subject to such provisions, the Debenture Trustee is under no
obligation to exercise any of the powers vested in it by the Indenture at the
request of any holder of the Junior Subordinated Debentures, unless offered
reasonable indemnity by such holder against the costs, expenses and liabilities
which might be incurred thereby. The Debenture Trustee is not required to expend
or risk its own funds or otherwise incur personal financial liability in the
performance of its duties if the Debenture Trustee reasonably believes that
repayment or adequate indemnity is not reasonably assured to it.
DISTRIBUTION OF THE JUNIOR SUBORDINATED DEBENTURES
As described under "Description of the Preferred
Securities--Liquidation of the Trust Issuer and Distribution of the Junior
Subordinated Debentures to Holders," under certain circumstances involving the
dissolution of the Trust Issuer, Junior Subordinated Debentures may be
distributed to the holders of the Preferred Securities in exchange therefor upon
liquidation of the Trust Issuer, after satisfaction of liabilities to creditors
of the Trust Issuer as provided by applicable law. Any such distribution will be
subject to receipt of prior regulatory approval if then required. If the Junior
Subordinated Debentures are distributed to the holders of Preferred Securities
upon the liquidation of the Trust Issuer, the Company will use its best efforts
to list the Junior Subordinated Debentures on the Nasdaq Stock Market's National
Market or such stock exchanges, if any, on which the Preferred Securities are
then listed. There can be no assurance as to the market price of any Junior
Subordinated Debentures that may be distributed to the holders of the Preferred
Securities.
PAYMENT AND PAYING AGENTS
Payment of principal of and any interest on the Junior Subordinated
Debentures will be made at the offices of the Debenture Trustee in the city of
New York or at the offices of such paying agent or paying agents as the Company
may designate from time to time, except that at the option of the Company
payment of any interest may be made (i) by check mailed to the address of the
Person entitled thereto as such address shall appear in the Debenture Register
or (ii) by transfer to an account maintained by the Person entitled thereto as
specified in the Debenture Register, provided that proper transfer instructions
have been received by the regular record date. Payment of any interest on the
Junior Subordinated Debentures will be made to the Person in whose name the
Subordinated Debenture is registered at the close of business on the
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regular record date for such interest, except in the case of Deferred Interest.
The Company may at any time designate additional Paying Agents or rescind the
designation of any Paying Agent; however, the Company will at all times be
required to maintain a Paying Agent in each Place of Payment for the Junior
Subordinated Debentures.
Any moneys deposited with the Debenture Trustee or any Paying Agent, or
then held by the Company in trust, for the payment of the principal of or
interest on the Junior Subordinated Debentures and remaining unclaimed for two
years after such principal or interest has become due and payable shall be
repaid to the Company upon written request of the Company on May 31 of each year
or (if then held in trust by the Company) will be discharged from such trust and
the holders of the Junior Subordinated Debentures shall thereafter look, as
general unsecured creditors, only to the Company for payment thereof.
REGISTRAR AND TRANSFER AGENT
The Debenture Trustee will act as the registrar and the transfer agent
for the Junior Subordinated Debentures. Junior Subordinated Debentures may be
presented for registration of transfer (with the form of transfer endorsed
thereon, or a satisfactory written instrument of transfer, duly executed) at the
office of the registrar. The Company may at any time rescind the designation of
any such transfer agent or approve a change in the location through which any
such transfer agent acts; provided that the Company maintains a transfer agent
in the place of payment. The Company may at any time designate additional
transfer agents with respect to the Junior Subordinated Debentures. In the event
of any redemption, neither the Company nor the Debenture Trustee will be
required to (i) issue, register the transfer of or exchange Junior Subordinated
Debentures during a period beginning at the opening of business 15 days before
the day of selection for redemption of Junior Subordinated Debentures and ending
at the close of business on the day of mailing of the relevant notice of
redemption, or (ii) transfer or exchange any Junior Subordinated Debentures so
selected for redemption, except, in the case of any Junior Subordinated
Debentures being redeemed in part, any portion thereof not to be redeemed.
DESCRIPTION OF THE GUARANTEE
A Guarantee will be executed and delivered by the Company concurrently
with the issuance of the Preferred Securities for the benefit of the holders
from time to time of such Preferred Securities (the "Guarantee"). The Bank of
New York will act as trustee ("Guarantee Trustee") under the Guarantee. This
summary of certain provisions of the Guarantee does not purport to be complete
and is subject to, and qualified in its entirety by reference to, all of the
provisions of the Guarantee. Wherever particular defined terms of the Guarantee
are referred to, but not defined herein, such defined terms are incorporated
herein by reference. The form of the Guarantee has been filed as an exhibit to
the Registration Statement of which this Prospectus forms a part.
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GENERAL
The Company will irrevocably agree to pay in full on a subordinated
basis, to the extent set forth herein, the Guarantee Payments (as defined below)
to the holders of the Preferred Securities, as and when due, regardless of any
defense, right of set-off or counterclaim that the Trust Issuer may have or
assert other than the defense of payment. The following payments with respect to
the Preferred Securities, to the extent not paid by or on behalf of the Trust
Issuer (the "Guarantee Payments"), will be subject to the Guarantee: (i) any
accrued and unpaid Distributions required to be paid on the Preferred
Securities, to the extent that the Trust Issuer has funds on hand available
therefor at such time, (ii) the Redemption Price with respect to any Preferred
Securities called for redemption, to the extent that the Trust Issuer has funds
on hand available therefor at such time, or (iii) upon a voluntary or
involuntary dissolution, winding up or termination of the Trust Issuer (unless
the Junior Subordinated Debentures are distributed to holders of the Preferred
Securities), the lesser of (a) the Liquidation Distribution, to the extent that
the Trust Issuer has funds available therefor at such time, and (b) the amount
of assets of the Trust Issuer remaining available for distribution to holders of
the Preferred Securities after satisfaction of liabilities to creditors of the
Trust Issuer as required by applicable law. The Company's obligation to make a
Guarantee Payment may be satisfied by direct payment of the required amounts by
the Company to the holders of the Preferred Securities or by causing the Trust
Issuer to pay such amounts to such holders.
The Guarantee will be an irrevocable guarantee on a subordinated basis
of the Trust Issuer's obligations under the Preferred Securities, but will apply
only to the extent that the Trust Issuer has funds sufficient to make such
payments, and is not a guarantee of collection.
If the Company does not make interest payments on the Junior
Subordinated Debentures held by the Trust Issuer, the Trust Issuer will not be
able to pay Distributions on the Preferred Securities and will not have funds
legally available therefor. The Guarantee will rank subordinate and junior in
right of payment to all Senior Debt of the Company. See "Description of the
Guarantee--Status of the Guarantee." Because the Company is a holding company,
the right of the Company to participate in any distribution of assets of any
subsidiary upon such subsidiary's liquidation or reorganization or otherwise is
subject to the prior claims of creditors of that subsidiary, except to the
extent the Company may itself be recognized as a creditor of that subsidiary.
Accordingly, the Company's obligations under the Guarantee will be effectively
subordinated to all existing and future liabilities of the Company's
subsidiaries, and claimants should look only to the assets of the Company for
payments thereunder. The Guarantee does not limit the incurrence or issuance of
other secured or unsecured debt of the Company, including Senior Debt, whether
under the Indenture, any other indenture that the Company may enter into in the
future, or otherwise. The Company may from time to time to incur indebtedness
constituting Senior Indebtedness.
The Company and the Trust Issuer believe that the Company has, through
the Guarantee, the Trust Agreement, the Junior Subordinated Debentures, the
Indenture and the Expense Agreement, taken together, fully, irrevocably and
unconditionally guaranteed all of the Trust
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Issuer's obligations under the Preferred Securities, on a subordinated basis. No
single document standing alone or operating in conjunction with fewer than all
of the other documents constitutes such guarantee. It is only the combined
operation of these documents that has the effect of providing a full,
irrevocable and unconditional guarantee of the Trust Issuer's obligations under
the Preferred Securities. See "Relationship Among the Preferred Securities, the
Junior Subordinated Debentures, the Expense Agreement and the Guarantee."
STATUS OF THE GUARANTEE
The Guarantee will constitute an unsecured obligation of the Company
and will rank subordinate and junior in right of payment to all Senior
Indebtedness of the Company in the same manner as the Junior Subordinated
Debentures.
The Guarantee will constitute a guarantee of payment and not of
collection (i.e., the guaranteed party may institute a legal proceeding directly
against the Company to enforce its rights under the Guarantee without first
instituting a legal proceeding against any other person or entity). The
Guarantee will be held for the benefit of the holders of the Preferred
Securities. The Guarantee will not be discharged except by payment of the
Guarantee Payments in full to the extent not paid by the Trust Issuer or upon
distribution to the holders of the Preferred Securities of the Junior
Subordinated Debentures.
AMENDMENTS AND ASSIGNMENT
Except with respect to any changes that do not materially adversely
affect the rights of holders of the Preferred Securities (in which case no vote
will be required), the Guarantee may not be amended without the prior approval
of the holders of not less than a majority of the aggregate Liquidation Amount
of such outstanding Preferred Securities. The manner of obtaining any such
approval will be as set forth under "Description of the Preferred
Securities--Voting Rights; Amendment of the Trust Agreement." All guarantees and
agreements contained in the Guarantee shall bind the successors, assigns,
receivers, trustees and representatives of the Company and shall inure to the
benefit of the holders of the Preferred Securities then outstanding.
EVENTS OF DEFAULT
An event of default under the Guarantee will occur upon the failure of
the Company to perform any of its payments or other obligations thereunder. The
holders of not less than a majority in aggregate Liquidation Amount of the
Preferred Securities have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Guarantee Trustee in
respect of such Guarantee or to direct the exercise of any trust or power
conferred upon the Guarantee Trustee under the Guarantee.
The Company, as guarantor, is required to file annually with the
Guarantee Trustee a certificate as to whether or not the Company is in
compliance with all the conditions and covenants applicable to it under the
Guarantee.
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INFORMATION CONCERNING THE GUARANTEE TRUSTEE
The Guarantee Trustee, other than during the occurrence and continuance
of a default by the Company in the performance of the Guarantee, undertakes to
perform only such duties as are specifically set forth in the Guarantee and,
after default with respect to the Guarantee, must exercise the same degree of
care and skill as a prudent person would exercise or use in the conduct of his
or her own affairs. Subject to this provision, the Guarantee Trustee is under no
obligation to exercise any of the powers vested in it by the Guarantee at the
request of any holder of the Preferred Securities unless it is offered
reasonable indemnity by such holder against the costs, expenses and liabilities
that might be incurred thereby. The Guarantee Trustee is not required to expend
or risk its own funds or otherwise incur personal financial liability in the
performance of its duties if the Guarantee Trustee reasonably believes repayment
or adequate indemnity is not reasonably assured to it.
TERMINATION OF THE GUARANTEE
The Guarantee will terminate and be of no further force and effect upon
(a) full payment of the Redemption Price of the Preferred Securities, (b) full
payment of the amounts payable upon liquidation of the Trust Issuer, or (c)
distribution of the Junior Subordinated Debentures to the holders of the
Preferred Securities in exchange therefor. The Guarantee will continue to be
effective or will be reinstated, as the case may be, if at any time any holder
of the Preferred Securities must restore payment of any sums paid under the
Preferred Securities or the Guarantee.
GOVERNING LAW
The Guarantee will be governed by and construed in accordance with the
laws of the State of New York, without regard to conflicts of laws principles
thereof.
THE EXPENSE AGREEMENT
Pursuant to the Agreement as to Expenses and Liabilities entered into
by the Company under the Trust Agreement (the "Expense Agreement"), the Company
will irrevocably and unconditionally guarantee to each person or entity to whom
the Trust Issuer becomes indebted or liable, the full payment of any costs,
expenses or liabilities of the Trust Issuer, other than obligations of the Trust
Issuer to pay to the holders of the Preferred Securities the amounts due such
holders pursuant to the terms of the Preferred Securities. Third party creditors
of the Trust Issuer may proceed directly against the Company under the Expense
Agreement, regardless of whether such creditors had notice of the Expense
Agreement.
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RELATIONSHIP AMONG THE PREFERRED SECURITIES,
THE JUNIOR SUBORDINATED DEBENTURES, THE EXPENSE
AGREEMENT AND THE GUARANTEE
FULL AND UNCONDITIONAL GUARANTEE
Payments of Distributions and other amounts due on the Preferred
Securities (to the extent the Trust Issuer has funds available for the payment
of such Distributions) are irrevocably guaranteed by the Company as and to the
extent set forth under "Description of the Guarantee." The Company and the Trust
Issuer believe that, taken together, the Company's obligations under the Junior
Subordinated Debentures, the Indenture, the Trust Agreement, the Expense
Agreement and the Guarantee provide, in the aggregate, a full, irrevocable and
unconditional guarantee of payments of distributions and other amounts due on
the Preferred Securities, on a subordinated basis. No single document standing
alone or operating in conjunction with fewer than all of the other documents
constitutes such guarantee. It is only the combined operation of these documents
that has the effect of providing a full, irrevocable and unconditional guarantee
of the Trust Issuer's obligations under the Preferred Securities. If and to the
extent that the Company does not make payments on the Junior Subordinated
Debentures, the Trust Issuer will not pay Distributions or other amounts due on
its Preferred Securities. The Guarantee does not cover payment of Distributions
when the Trust Issuer does not have sufficient funds to pay such Distributions.
In such event, the remedy of a holder of the Preferred Securities is to
institute a Direct Action against the Company for enforcement of payment of such
Distributions to such holder. The obligations of the Company under the Guarantee
are subordinate and junior in right of payment to all Senior Debt.
SUFFICIENCY OF PAYMENTS
As long as payments of interest and other payments are made when due on
the Junior Subordinated Debentures, such payments will be sufficient to cover
Distributions and other payments due on the Preferred Securities, primarily
because: (i) the aggregate principal amount of the Junior Subordinated
Debentures will be equal to the sum of the aggregate stated Liquidation Amount
of the Preferred Securities and Common Securities; (ii) the interest rate and
interest and other payment dates on the Junior Subordinated Debentures will
match the Distribution rate and Distribution and other payment dates for the
Preferred Securities; (iii) the Company shall pay for all and any costs,
expenses and liabilities of the Trust Issuer except the Trust Issuer's
obligations to holders of its Preferred Securities; and (iv) the Trust Agreement
further provides that the Trust Issuer will not engage in any activity that is
not consistent with the limited purposes of the Trust Issuer.
Notwithstanding anything to the contrary in the Indenture, the Company
has the right to set off any payment it is otherwise required to make thereunder
with and to the extent the Company has theretofore made, or is concurrently on
the date of making such payment, a payment under the Guarantee.
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ENFORCEMENT RIGHTS OF HOLDERS OF THE PREFERRED SECURITIES
A holder of a Preferred Security may institute a legal proceeding
directly against the Company to enforce its rights under the Guarantee without
first instituting a legal proceeding against the Guarantee Trustee, the Trust
Issuer or any other person or entity.
A default or event of default under any Senior Debt of the Company
would not constitute a default or event of default under the Indenture. However,
in the event of payment defaults under, or acceleration of, Senior Debt of the
Company, the subordination provisions of the Indenture provide that no payments
may be made in respect of the Junior Subordinated Debentures until such Senior
Debt has been paid in full or any payment default thereunder has been cured or
waived. Failure to make required payments on the Junior Subordinated Debentures
would constitute an event of default under the Indenture.
LIMITED PURPOSE OF THE TRUST ISSUER
The Preferred Securities evidence a preferred undivided beneficial
interest in the assets of the Trust Issuer, and the Trust Issuer exists for the
sole purpose of issuing its Preferred Securities and Common Securities and
investing the proceeds thereof in Junior Subordinated Debentures. A principal
difference between the rights of a holder of a Preferred Security and a holder
of a Junior Subordinated Debenture is that a holder of a Junior Subordinated
Debenture is entitled to receive from the Company the principal amount of and
interest accrued on Junior Subordinated Debentures held, while a holder of the
Preferred Securities is entitled to receive Distributions from the Trust Issuer
(or from the Company under the Guarantee) if, and to the extent, the Trust
Issuer has funds available for the payment of such Distributions.
RIGHTS UPON DISSOLUTION
Upon any voluntary or involuntary dissolution, winding-up or
liquidation of the Trust Issuer involving the liquidation of the Junior
Subordinated Debentures, after satisfaction of liabilities to creditors of the
Trust Issuer, if any, as provided by applicable law, the holders of the
Preferred Securities will be entitled to receive, out of assets held by the
Trust Issuer, the Liquidation Distribution in cash. See "Description of the
Preferred Securities-Liquidation Distribution Upon Dissolution." Upon any
voluntary or involuntary liquidation or bankruptcy of the Company, the Property
Trustee, as holder of the Junior Subordinated Debentures, would be a
subordinated creditor of the Company, subordinated in right of payment to all
Senior Debt as set forth in the Indenture, but entitled to receive payment in
full of principal and interest, before any stockholders of the Company receive
payments or distributions. Since the Company is the guarantor under the
Guarantee and has agreed to pay for all costs, expenses and liabilities of the
Trust Issuer (other than the Trust Issuer's obligations to the holders of its
Preferred Securities), the positions of a holder of such Preferred Securities
and a holder of the Junior Subordinated Debentures relative to other creditors
and to stockholders of the Company in the event of liquidation or bankruptcy of
the Company are expected to be substantially the same.
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CERTAIN FEDERAL INCOME TAX CONSEQUENCES
The following is a summary of the principal United States federal
income tax consequences of the purchase, ownership and disposition of the
Preferred Securities. This summary addresses only the tax consequences to a
person that acquires Preferred Securities on their original issue at the stated
offering price and does not address the tax consequences to persons that may be
subject to special treatment under United States federal income tax law, such as
banks, insurance companies, thrift institutions, regulated investment companies,
real estate investment trusts, employee benefit plans, tax-exempt organizations,
dealers in securities or currencies, persons that will hold Preferred Securities
as part of a position in a "straddle" or as part of a "hedging", "conversion" or
other integrated investment transaction for federal income tax purposes, persons
whose functional currency is not the United States dollar or persons that do not
hold Preferred Securities as capital assets.
The statements of law or legal conclusions set forth in this summary
constitute the opinion of Maloney & Knox, special tax counsel to the Company and
the Trust Issuer. This summary is based upon the Internal Revenue Code of 1986,
as amended (the "Code"), Treasury Regulations, Internal Revenue Service rulings
and pronouncements and judicial decisions now in effect, all of which are
subject to change at any time. Such changes may be applied retroactively in a
manner that could cause the tax consequences to vary substantially from the
consequences described below, possibly adversely affecting a beneficial owner of
the Preferred Securities. The authorities on which this summary is based are
subject to various interpretations, and it is therefore possible that the United
States federal income tax treatment of the purchase, ownership and disposition
of the Preferred Securities may differ from the treatment described below.
THE UNITED STATES FEDERAL INCOME TAX DISCUSSION SET FORTH BELOW IS
INCLUDED FOR GENERAL INFORMATION ONLY AND MAY NOT BE APPLICABLE DEPENDING ON A
HOLDER'S PARTICULAR SITUATION. PROSPECTIVE INVESTORS ARE ADVISED TO CONSULT WITH
THEIR OWN TAX ADVISORS IN LIGHT OF THEIR OWN PARTICULAR CIRCUMSTANCES AS TO THE
UNITED STATES FEDERAL TAX CONSEQUENCES OF THE PURCHASE, OWNERSHIP AND
DISPOSITION OF THE PREFERRED SECURITIES, AS WELL AS THE EFFECT OF ANY STATE,
LOCAL OR FOREIGN TAX LAWS.
CLASSIFICATION OF THE TRUST ISSUER
In the opinion of Maloney & Knox, under current law, the Trust Issuer
will not be classified as an association taxable as a corporation for United
States federal income tax purposes. As a result, for United States federal
income tax purposes, each beneficial owner of Preferred Securities (a
"Securityholder") will be treated as owning an undivided beneficial interest in
the Junior Subordinated Debentures, and thus, will be required to include in its
gross income its pro rata share of the interest (or accrued original issue
discount) in addition to any interest and other income (if any) with respect to
the Junior Subordinated Debentures. See "--Interest Income
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and Original Issue Discount." No amount included in income with respect to the
Preferred Securities will be eligible for the dividends-received deduction.
CLASSIFICATION OF THE JUNIOR SUBORDINATED DEBENTURES
In connection with the classification of the Junior Subordinated
Debentures, Maloney & Knox is of the opinion that such securities will be
classified for United States federal income tax purposes as indebtedness of the
Company under current law, and thus the payments designated as interest under
the terms of the Junior Subordinated Debentures will be deductible by the
Company for federal income tax purposes. No assurance can be given, however,
that the Internal Revenue Service will not challenge such classification.
INTEREST INCOME AND ORIGINAL ISSUE DISCOUNT
Under applicable Treasury regulations, currently Section 1.1275-2(h)
(the "Regulations"), if the terms and conditions of a debt instrument make the
likelihood that stated interest will not be timely paid a "remote" contingency,
such contingency will be ignored in determining whether the debt instrument is
issued with original issue discount ("OID"). The Company believes that the
likelihood of its exercising its option to defer payments of interest on the
Junior Subordinated Debentures is remote, since exercising that option would
prevent it from declaring dividends on any class of its stock. Based on the
foregoing, the Company intends to take the position that the Junior Subordinated
Debentures were not issued with OID and, accordingly, a Securityholder
purchasing the Preferred Securities at the stated price should be required to
include in gross income only such Securityholder's pro rata share of stated
interest on the Junior Subordinated Debentures in accordance with such
Securityholder's method of tax accounting.
The Regulations have not yet been addressed in any rulings or other
published interpretations by the Internal Revenue Service (the "IRS"). In the
opinion of Maloney & Knox, it is not unreasonable for the Company to take the
position that the Junior Subordinated Debentures will not be issued with OID.
However, it is possible the IRS could take the position that the likelihood of
deferral was not a remote contingency within the meaning of the Regulations.
Under the Regulations, if the Company were to exercise its option to
defer payments of interest after treating the Junior Subordinated Debentures as
issued without OID, the Junior Subordinated Debentures would be treated as
re-issued with OID at that time, and all stated interest (and de minimis OID, if
any) on the Junior Subordinated Debentures would thereafter be treated as OID as
long as the Junior Subordinated Debentures remained outstanding. In such event,
all of a Securityholder's interest income with respect to the Junior
Subordinated Debentures would be accounted for as OID on an economic accrual
basis regardless of such Securityholder's method of tax accounting, and actual
distributions of stated interest related thereto would not be includable in
gross income. Consequently, a Securityholder would be required to include OID in
gross income even though the Company would not make and the Securityholder would
not receive any actual cash payments during an Extension Period.
62
<PAGE>
A Securityholder that disposed of Preferred Securities prior to the
record date for the payment of Distributions following an Extension Period would
include OID in gross income but would not receive any cash related thereto from
the Trust Issuer. Any amount of OID included in a Securityholder's gross income
(whether or not during an Extension Period) would increase such Securityholder's
tax basis in its Preferred Securities, and the amount of Distributions not
includable in gross income would reduce such Securityholder's tax basis in its
Preferred Securities.
DISTRIBUTION OF THE JUNIOR SUBORDINATED DEBENTURES TO HOLDERS OF THE PREFERRED
SECURITIES
Under current United States federal income tax law and provided that
the Trust Issuer is not treated as an association taxable as a corporation, a
distribution by the Trust Issuer of the Junior Subordinated Debentures as
described under the caption "Description of the Preferred Securities-Liquidation
of the Trust Issuer and Distribution of the Junior Subordinated Debentures to
Holders" will be nontaxable to the Securityholders and will result in a
Securityholder receiving its pro rata share of the Junior Subordinated
Debentures previously held indirectly through the Trust Issuer, with a holding
period and aggregate tax basis equal to the holding period and aggregate tax
basis such Securityholder had in its Preferred Securities before such
distribution. A Securityholder will account for interest in respect of the
Junior Subordinated Debentures received from the Trust Issuer in the manner
described above under "Certain Federal Income Tax Consequences--Interest Income
and Original Issue Discount," including any accrual of OID (if any) attributed
to the Junior Subordinated Debentures upon the distribution.
SALES OR REDEMPTION OF THE PREFERRED SECURITIES
Gain or loss will be recognized by a Securityholder on the sale of
Preferred Securities (including a redemption for cash or other consideration) in
an amount equal to the difference between the amount realized on the sale (or
redemption) and the Securityholder's adjusted tax basis in the Preferred
Securities sold or so redeemed. Gain or loss recognized by a Securityholder on
Preferred Securities held for more than one year will generally be taxable as
long-term capital gain or loss. Pursuant to the Taxpayer Relief Act of 1997,
Preferred Securities constituting a capital asset which are acquired by an
individual after July 28, 1997, and held for more than 18 months are accorded a
maximum United States federal capital gains tax rate of 20% (or a rate of 10%,
if the individual taxpayer is in the 15% tax bracket). Effective in 2001, the
20% rate drops to 18% (and the 10% rate drops to 8%) for capital assets acquired
after the year 2000 and held more than five years; however, the requirement that
the capital asset be acquired after the year 2000 does not apply to the 8% rate.
Preferred Securities held by an individual for more than one year, but not more
than 18 months, are accorded a United States federal capital gains tax rate of
28%.
If the Company were to exercise its option to defer payments of
interest on the Junior Subordinated Debentures, the Preferred Securities might
trade at a price that did not fully reflect the value of accrued but unpaid
interest with respect to the underlying Junior Subordinated Debentures. A
Securityholder that disposed of its Preferred Securities between record dates
for
63
<PAGE>
payments of Distributions (and consequently did not receive a Distribution from
the Trust Issuer for the period prior to such disposition) would nevertheless be
required to include in income as ordinary income accrued but unpaid interest on
the Junior Subordinated Debentures through the date of disposition and to add
such amount to its adjusted tax basis in its Preferred Securities disposed of.
Such Securityholder would recognize a capital loss on the disposition of its
Preferred Securities to the extent the selling price (which might not fully
reflect the value of accrued but unpaid interest) was less than the
Securityholder's adjusted tax basis in the Preferred Securities (which would
include accrued but unpaid interest). Subject to certain limited exceptions,
capital losses cannot be applied to offset ordinary income for United States
federal income tax purposes.
UNITED STATES ALIEN HOLDERS
For purposes of this discussion, a "United States Alien Holder" is any
corporation, individual, partnership, estate or trust that is, as to the United
States, a foreign corporation, a non-resident alien individual, a foreign
partnership or a non-resident fiduciary of a foreign estate or trust.
Under current United States federal income tax law: (i) payments by the
Trust Issuer or any of its paying agents to any Securityholder who or which is a
United States Alien Holder will not be subject to United States federal
withholding tax provided that (a) the Securityholder does not actually or
constructively own 10% or more of the total combined voting power of all classes
of stock of the Company entitled to vote, (b) the Securityholder is not a
controlled foreign corporation that is related to the Company through stock
ownership and (c) either (A) the Securityholder certifies to the Trust Issuer or
its agent, under penalties of perjury, that it is not a United States holder and
provides its name and address or (B) a securities clearing organization, bank or
other financial institution that holds customers' securities in the ordinary
course of its trade or business (a "Financial Institution") certifies to the
Trust Issuer or its agent, under penalties of perjury, that such statement has
been received from the Securityholder by it or by a Financial Institution
holding such security for the Securityholder and furnishes the Trust Issuer or
its agent with a copy thereof, and (ii) a United States Alien Holder of a
Preferred Security will not be subject to United States federal withholding tax
on any gain realized upon the sale or other disposition of a Preferred Security.
Proposed Treasury regulations (the "Proposed Regulations") would
provide alternative methods for satisfying the certification requirement
described in clause (i)(c) above. The Proposed Regulations also would require,
in the case of Preferred Securities held by a foreign partnership, that (x) the
certification described in clause (i)(c) above be provided by the partners
rather than by the foreign partnership and (y) the partnership provide certain
information, including a United States taxpayer identification number. A
look-through rule would apply in the case of tiered partnerships. The Proposed
Regulations are proposed to be effective for payments made after December 31,
1997. There can be no assurance that the Proposed Regulations will be adopted or
as to the provisions that they will include if and when adopted in temporary or
final form. The Trust Issuer will issue a Form 1042 or Form 1042-S, where
appropriate.
64
<PAGE>
INFORMATION REPORTING TO SECURITYHOLDERS
Generally, income on the Preferred Securities will be reported to
Securityholders on Forms 1099-INT, which will be mailed to Securityholders by
January 31 following each calendar year.
BACKUP WITHHOLDING
Payments made on, and proceeds from the sale of, Preferred Securities
may be subject to a "backup" withholding tax of 31% unless the Securityholder
complies with certain certification requirements. Any withheld amounts will be
allowed as a credit against the Securityholder's United States federal income
tax, provided the required information is provided to the Internal Revenue
Service.
ERISA CONSIDERATIONS
The Company and certain affiliates of the Company may each be
considered a "party in interest" within the meaning of the Employee Retirement
Income Security Act of 1974, as amended ("ERISA"), or a "disqualified person"
within the meaning of Section 4975 of the Code with respect to many employee
benefit plans ("Plans") that are subject to ERISA. The purchase of the Preferred
Securities by a Plan that is subject to the fiduciary responsibility provisions
of ERISA or the prohibited transaction provisions of Section 4975(e)(1) of the
Code and with respect to which the Company, or any affiliate of the Company, is
a service provider (or otherwise is a party in interest or a disqualified
person) may constitute or result in a prohibited transaction under ERISA or
Section 4975 of the Code, unless the Preferred Securities are acquired pursuant
to and in accordance with an applicable exemption. Any pension or other employee
benefit plan proposing to acquire any Preferred Securities should consult with
its counsel.
UNDERWRITING
Subject to the terms and conditions of the Underwriting Agreement (the
"Underwriting Agreement") dated ________, 1998, among the Company, the Trust
Issuer and Legg Mason Wood Walker, Incorporated (the "Underwriter"), the Trust
Issuer has agreed to sell to the Underwriter, and the Underwriter has agreed to
purchase from the Trust Issuer, $11,000,000 aggregate Liquidation Amount of
Preferred Securities at the public offering price subject to the underwriting
commissions set forth on the cover page of this Prospectus.
The Underwriting Agreement provides that the obligations of the
Underwriter are subject to certain conditions precedent and that the Underwriter
will purchase all of the Preferred Securities offered hereby if any of such
Preferred Securities are purchased.
The Company has been advised by the Underwriter that the Underwriter
proposes to offer the Preferred Securities to the public and other dealers at
the public offering price set forth on
65
<PAGE>
the cover page of this Prospectus and will share with certain dealers from its
commission a concession not in excess of $____ per Preferred Security. After the
public offering, the offering price and other selling terms may be changed by
the Underwriter.
The Company has granted to the Underwriter an option, exercisable not
later than 30 days after the date of this Prospectus, to purchase up to an
additional $1,650,000 aggregate Liquidation Amount of the Preferred Securities
at the public offering price plus accrued Distributions, if any, from ________,
1998. To the extent that the Underwriter exercises such option, the Company will
be obligated, pursuant to the option, to sell such Preferred Securities to the
Underwriter. The Underwriter may exercise such option only to cover
over-allotments made in connection with the sale of the Preferred Securities
offered hereby. If purchased, the Underwriter will offer such additional
Preferred Securities on the same terms as those on which the $11,000,000
aggregate Liquidation Amount of the Preferred Securities are being offered.
In view of the fact that the proceeds from the sale of the Preferred
Securities will be used to purchase the Junior Subordinated Debentures issued by
the Company, the Underwriting Agreement provides that the Company will pay as
compensation for the Underwriter's arranging the investment therein of such
proceeds an amount of $____ per Preferred Security (or $_______ ($_______ if the
over-allotment option is exercised in full) in the aggregate). The Company has
also agreed to reimburse the Underwriter for its reasonable out-of-pocket
expenses, including legal fees and expenses relating to the offering of the
Preferred Securities.
In connection with the offering of the Preferred Securities, the
Underwriter and any selling group members and their respective affiliates may
engage in transactions effected in accordance with Rule 104 of the Securities
and Exchange Commission's Regulation M that are intended to stabilize, maintain
or otherwise affect the market price of the Preferred Securities. Such
transactions may include over-allotment transactions in which the Underwriter
creates a short position for its own account by selling more Preferred
Securities than it is committed to purchase from the Trust Issuer. In such a
case, to cover all or part of the short position, the Underwriter may exercise
the over-allotment option described above or may purchase Preferred Securities
in the open market following completion of the initial offering of the Preferred
Securities. The Underwriter also may engage in stabilizing transactions in which
it bids for, and purchases, shares of the Preferred Securities at a level above
that which might otherwise prevail in the open market for the purpose of
preventing or retarding a decline in the market price of the Preferred
Securities. The Underwriter also may reclaim any selling concessions allowed to
an Underwriter or dealer if the Underwriter repurchases shares distributed by
the Underwriter or dealer. Any of the foregoing transactions may result in the
maintenance of a price for the Preferred Securities at a level above that which
might otherwise prevail in the open market. Neither the Company nor the
Underwriter makes any representation or prediction as to the direction or
magnitude of any effect that the transactions described above may have on the
price of the Preferred Securities. The Underwriter is not required to engage in
any of the foregoing transactions and, if commenced, such transactions may be
discontinued at any time without notice.
Because the National Association of Securities Dealers, Inc. ("NASD")
is expected to view the Preferred Securities as interests in a direct
participation program, the offering of the
66
<PAGE>
Preferred Securities is being made in compliance with the applicable provisions
of Rule 2810 of the NASD's Conduct Rules.
The Preferred Securities are a new issue of securities with no
established trading market. The Company and the Trust Issuer have been advised
by the Underwriter that it intends to make a market in the Preferred Securities.
However, the Underwriter is not obligated to do so and such market making may be
interrupted or discontinued at any time without notice at the sole discretion of
the Underwriter. Application has been made by the Company to list the Preferred
Securities on the Nasdaq National Market, but one of the requirements for
listing and continuing listing is the presence of two market makers for the
Preferred Securities, and the presence of a second market maker cannot be
assured. Accordingly, no assurance can be given as to the development or
liquidity of any market for the Preferred Securities.
The Company and the Trust Issuer have agreed to indemnify the
Underwriter against certain liabilities, including liabilities under the
Securities Act.
The Underwriter has in the past and may in the future perform various
services for the Company, including investment banking services, for which it
has and will receive customary fees for such services.
VALIDITY OF SECURITIES
Certain matters of Delaware law relating to the validity of the
Preferred Securities, the enforceability of the Trust Agreement and the creation
of the Trust Issuer will be passed upon by Richards, Layton & Finger, P.A.
special Delaware counsel to the Company and the Trust Issuer. The validity of
the Guarantee and the Junior Subordinated Debentures will be passed upon for the
Company by Maloney & Knox. Certain legal matters will be passed upon for the
Underwriter by Elias, Matz, Tiernan & Herrick L.L.P. Certain matters relating to
the United States federal income tax considerations will be passed upon for the
Company by Maloney & Knox.
EXPERTS
The consolidated financial statements of the Company as of December 31,
1997 and 1996, and for each of the years in the three-year period ended December
31, 1997, appearing in the 1997 Annual Report of the Company to its shareholders
and incorporated by reference in the Annual Report on Form 10-K for the year
ended December 31, 1997, have been incorporated by reference in the Prospectus
and in the Registration Statement of which this Prospectus forms a part, in
reliance upon the report of KPMG Peat Marwick LLP, independent public
accountants, incorporated by reference herein, whose report thereon appears
therein, and upon the authority of said firm as experts in accounting and
auditing. The report of KPMG Peat Marwick LLP refers to a change in the method
of accounting for mortgage servicing rights as of January 1, 1996.
67
<PAGE>
<TABLE>
<CAPTION>
================================================================= ====================================================
<S> <C>
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR
TO MAKE ANY REPRESENTATIONS IN CONNECTION WITH THIS OFFERING $11,000,000
OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS AND, IF GIVEN
OR MADE, SUCH INFORMATION AND REPRESENTATIONS MUST NOT BE
RELIED UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY, THE
TRUST ISSUER OR THE UNDERWRITER. NEITHER THE DELIVERY OF THIS
PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL, UNDER ANY AMERICAN BANCORPORATION
CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THERE HAS BEEN NO CAPITAL TRUST I
CHANGE IN THE AFFAIRS OF THE COMPANY SINCE THE DATE HEREOF
OR THAT THE INFORMATION CONTAINED HEREIN IS CORRECT AS OF ANY
TIME SUBSEQUENT TO THE DATE HEREOF. THIS PROSPECTUS DOES
NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO ___% TRUST PREFERRED SECURITIES
BUY ANY SECURITIES OTHER THAN THE REGISTERED SECURITIES TO (LIQUIDATION AMOUNT
WHICH IT RELATES. THIS PROSPECTUS DOES NOT CONSTITUTE AN $10 PER PREFERRED SECURITY)
OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY SUCH GUARANTEED, AS DESCRIBED HEREIN, BY
SECURITIES IN ANY CIRCUMSTANCES IN WHICH SUCH OFFER OR
SOLICITATION IS UNLAWFUL.
AMERICAN BANCORPORATION
Table of Contents
Page
Available Information.................................... 1
Incorporation of Certain Documents by Reference.......... 2
Summary.................................................. 4 ------------------------------------
Selected Consolidated Financial
and Other Data of the Company.......................... 13
Risk Factors............................................. 15 PROSPECTUS
Use of Proceeds.......................................... 26
Market for the Preferred Securities...................... 26
Accounting Treatment..................................... 26
Ratio of Earnings to Fixed Charges....................... 27 ------------------------------------
Capitalization........................................... 28
Description of the Preferred Securities.................. 29
Description of Junior Subordinated Debentures............ 43
Description of the Guarantee............................. 55
Relationship Among the Preferred
Securities, the Junior Subordinated
Debentures, the Expense Agreement
and the Guarantee...................................... 59
Certain Federal Income Tax Consequences.................. 61
ERISA Considerations..................................... 65
Underwriting............................................. 65
Validity of Securities................................... 67
Experts ................................................ 67
Appendix A--Annual Report on Form 10-K for Year
Ended December 31, 1997................................A-1
LEGG MASON WOOD WALKER
INCORPORATED
__________, 1998
================================================================= ====================================================
</TABLE>
<PAGE>
PART II
INFORMATION NOT REQUIRED IN THE PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
<TABLE>
<CAPTION>
<S> <C>
SEC registration fee............................................................... $ 3,731.75
NASD fee........................................................................... 1,650.00
Nasdaq fees........................................................................ 10,750.00
Trustees' fees and expenses........................................................ 5,000.00
Legal fees and expenses............................................................ 80,000.00*
Accounting fees and expenses....................................................... 35,000.00*
Printing expenses.................................................................. 25,000.00*
Underwriters expenses.............................................................. 85,000.00*
Miscellaneous expenses............................................................. 3,868.25*
------------
Total..................................................................... $ 250,000.00*
============
</TABLE>
- ------------
* Estimated.
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
a) On May 16, 1973, the shareholders of the Registrant adopted a
resolution providing for the indemnification of any Director, Officer or former
Director or Officer for expenses, including attorney's fees, incurred in
connection with any claims made by reason of having served as an Officer or
Director. Such indemnification is subject to a determination that said person
was not negligent or guilty of misconduct, was acting in good faith, and had no
reasonable cause to believe that his conduct was unlawful.
The Registrant has adopted Article X to its Code of Regulations
providing for indemnification as follows:
Section I--Coverage:
The Corporation shall indemnify to the full extent permitted by law,
any person who is or was made, or was threatened with being made a party to any
lawsuit, action or proceeding (whether civil, criminal, administrative or
investigative) by reason of the fact that he, his testator, or intestate, is or
was a Director, Officer or employee of the Corporation or served any other
corporation or enterprise at the request of the Corporation.
II-1
<PAGE>
Section 2--Insurance:
The Corporation shall have the power to purchase and maintain insurance
on behalf of any person who is or was a Director, Officer or Agent of the
Corporation, or is or was at the request of the Corporation, serving as a
Director, Officer, Employee or Agent of another Corporation or enterprise,
against any liability asserted against him and incurred by him in any such
capacity or arising out of his status as such, whether or not the Corporation
would have the power to indemnify him against such liability under the
provisions of these regulations.
b) Section 1701.13(E) of the Ohio Revised Code grants Ohio Corporations
certain indemnifications to their officers and directors as a matter of right
under its statutes.
ITEM 16. EXHIBITS.
<TABLE>
<CAPTION>
EXHIBIT NO. DESCRIPTION
- ----------- -----------
<S> <C>
1 Form of Underwriting Agreement
4.1 Indenture of the Corporation relating to the Junior Subordinated Debentures
4.2 Form of Certificate of Junior Subordinated Debenture (included as Exhibit A to Exhibit 4.1)
4.3 Certificate of Trust of American Bancorporation Capital Trust I (included as Exhibit A to
Exhibit 4.4)
4.4 Amended and Restated Trust Agreement of American Bancorporation Capital Trust I
4.5 Form of Trust Preferred Security Certificate for American Bancorporation Capital Trust I
(included as Exhibit E to Exhibit 4.4)
4.6 Form of Guarantee of the Corporation relating to the Trust
Preferred Securities
5.1 Opinion and consent of Maloney & Knox
as to legality of the Junior Subordinated
Debentures and the Guarantee to be issued by the Corporation
5.2 Opinion and consent of Richards, Layton & Finger, P.A., as to
validity of the Trust Preferred Securities to be issued by
American Bancorporation Capital Trust I
8 Opinion of Maloney & Knox as to certain federal income tax matters
12 Computation of ratio of earnings to fixed charges
23.1 Consent of KPMG Peat Marwick LLP
23.2 Consent of Maloney & Knox (included in Exhibit 5.1)
23.3 Consent of Richards, Layton & Finger, P.A. (included in Exhibit 5.2)
24 Power of Attorney of certain officers and directors of the Corporation
25.1 Form T-1 Statement of Eligibility of The Bank of New York to act as Trustee under the
Indenture
25.2 Form T-1 Statement of Eligibility of The Bank of New York to act as Trustee under the
Declaration of Trust of American Bancorporation Capital Trust I
25.3 Form T-1 Statement of Eligibility of The Bank of New York under the Guarantee for the
benefit of the holders of the Trust Preferred Securities
</TABLE>
II-2
<PAGE>
ITEM 17. UNDERTAKINGS.
Each of the undersigned Registrants hereby undertakes:
(1) To file, during any period in which offers or sales are being made,
a post-effective amendment to this Registration Statement:
(i) To include any Prospectus required by Section 10(a)(3)
of the Securities Act of 1933;
(ii) To reflect in the Prospectus any facts or events arising
after the effective date of the Registration Statement (or the most
recent post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in the Registration Statement. Notwithstanding the foregoing, any
increase or decrease in volume of securities offered (if the total
dollar value of securities offered would not exceed that which was
registered) and any deviation from the low or high and of the estimated
maximum offering range may be reflected in the form of Prospectus filed
with the Commission pursuant to Rule 424(b) if, in the aggregate, the
changes in volume and price represent no more than a 20 percent change
in the maximum aggregate offering price set forth in the "Calculation
of Registration Fee" table in the effective Registration Statement;
(iii) To include any material information with respect to the
plan of distribution not previously disclosed in the Registration
Statement or any material change to such information in the
Registration Statement;
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed to be
a new Registration Statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the termination of
the offering.
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to trustees, officers and controlling persons of
the Registrant pursuant to the foregoing provisions, or otherwise, the
Registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the Registrant of expenses
incurred or paid by a trustee, officer or controlling person of the Registrant
in the successful defense of any action, suit or proceeding) is asserted by such
trustee, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such
II-3
<PAGE>
indemnification by it is against public policy as expressed in the Act and will
be governed by the final adjudication of such issue.
For purposes of determining any liability under the Securities Act of
1933, the information omitted from the form of prospectus filed as part of this
Registration Statement in reliance upon Rule 430A and contained in a form of
prospectus filed by the Registrants pursuant to Rule 424(b)(1) or (4) or 497(h)
under the Securities Act of 1933 shall be deemed to be part of this Registration
Statement as of the time it was declared effective.
For the purpose of determining any liability under the Securities Act
of 1933, each post-effective amendment that contains a form of prospectus shall
be deemed to be a new Registration Statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
II-4
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-2 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Wheeling, West Virginia, on the 17th day of March
1998.
AMERICAN BANCORPORATION
By: /s/ Jeremy C. McCamic
----------------------
Jeremy C. McCamic
Chairman of the Board and
Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
Name Title Date
- --------------------------------------- ------------------------------------------- ------------------------------
<S> <C> <C>
/s/ Jeremy C. McCamic Chairman of the Board and March 17, 1998
- ----------------------------- Chief Executive Officer
Jeremy C. McCamic (principal executive officer)
/s/ Brent E. Richmond Executive Vice President, March 17, 1998
- ------------------------------- Secretary, Treasurer, and CFO
Brent E. Richmond (principal financial and
accounting officer)
/s/ Paul W. Donahie President and Director March 17, 1998
- -------------------------------
Paul W. Donahie
/s/ Jay T. McCamic Director March 17, 1998
- -------------------------------
Jay T. McCamic
/s/ Jolyon W. McCamic Director March 17, 1998
- -----------------------------
Jolyon W. McCamic
/s/ Jack O. Cartner Director March 17, 1998
- ---------------------------------
Jack O. Curtner
/s/ Abigail M. Feinknopf Director March 17, 1998
- ----------------------------
Abigail M. Feinknopf
</TABLE>
II-5
<PAGE>
Pursuant to the requirements of the Securities Act of 1933, American
Bancorporation Capital Trust I has duly caused this Registration Statement to be
signed on its behalf by the undersigned, thereunto duly authorized, in the City
of Wheeling, West Virginia, on the 17th day of March 1998.
AMERICAN BANCORPORATION CAPITAL TRUST I
By: /s/ Jeremy C. McCamic
-----------------------------------
Jeremy C. McCamic
Administrative Trustee
By: /s/ Paul W. Donahie
-----------------------------------
Paul W. Donahie
Administrative Trustee
By: /s/ Brent E. Richmond
-----------------------------------
Brent E. Richmond
Administrative Trustee
II-6
<PAGE>
AMERICAN BANCORPORATION
AMERICAN BANCORPORATION CAPITAL TRUST I
FORM S-2
EXHIBIT LIST
<TABLE>
<CAPTION>
EXHIBIT NO. DESCRIPTION
- ----------- -----------
<S> <C>
1 Form of Underwriting Agreement
4.1 Indenture of the Corporation relating to the Junior Subordinated Debentures
4.2 Form of Certificate of Junior Subordinated Debenture (included as Exhibit A to Exhibit 4.1)
4.3 Certificate of Trust of American Bancorporation Capital Trust I (included as Exhibit A to
Exhibit 4.4)
4.4 Amended and Restated Trust Agreement of American Bancorporation Capital Trust I
4.5 Form of Trust Preferred Security Certificate for American Bancorporation Capital Trust I
(included as Exhibit E to Exhibit 4.4)
4.6 Form of Guarantee of the Corporation relating to the Trust Preferred Securities
5.1 Opinion and consent of Maloney & Knox as to legality of the Junior Subordinated Debentures
and the Guarantee to be issued by the Corporation
5.2 Opinion and consent of Richards, Layton & Finger, P.A., as to validity of the Trust Preferred
Securities to be issued by American Bancorporation Capital Trust I
8 Opinion of Maloney & Knox as to certain federal income tax matters
12 Computation of ratio of earnings to fixed charges
23.1 Consent of KPMG Peat Marwick LLP
23.2 Consent of Maloney & Knox (included in Exhibit 5.1)
23.3 Consent of Richards, Layton & Finger, P.A. (included in Exhibit 5.2)
24 Power of Attorney of certain officers and directors of the Corporation
25.1 Form T-1 Statement of Eligibility of The Bank of New York to act as Trustee under the
Indenture
25.2 Form T-1 Statement of Eligibility of The Bank of New York to act as Trustee under the
Declaration of Trust of American Bancorporation Capital Trust I
25.3 Form T-1 Statement of Eligibility of The Bank of New York under the Guarantee for the
benefit of the holders of the Trust Preferred Securities
</TABLE>
EXHIBIT 1
---------
AMERICAN BANCORPORATION
(an Ohio corporation); and
AMERICAN BANCORPORATION CAPITAL TRUST I
(a Delaware statutory business trust)
1,100,000
_____% Cumulative Trust
Preferred Securities
(Liquidation Amount $10 Per Cumulative Preferred Security)
UNDERWRITING AGREEMENT
----------------------
April 1, 1998
LEGG MASON WOOD WALKER, INCORPORATED
1747 Pennsylvania Avenue N.W.
Washington, D.C. 20006
Attention: Mark C. Micklem, Managing Director
Ladies and Gentlemen:
American Bancorporation Capital Trust I (the "Trust"), a statutory
business trust organized under the Delaware Business Trust Act, 12 Del. C.
ss.ss. 3801 et seq (the "Delaware Act"), confirms its agreement with you, Legg
Mason Wood Walker, Incorporated ("Legg Mason" or the "Underwriter"), with
respect to the issuance and sale by the Trust, and the purchase by the
Underwriter of 1,100,000 ___% Cumulative Trust Preferred Securities (liquidation
amount $10 per preferred security) and the grant by the Trust to the Underwriter
of the option described in Section 2(b) hereof to purchase all or any part of
165,000 additional Preferred Securities to cover overallotments, if any. The
aforesaid 1,100,000 preferred securities (the "Initial Preferred Securities") to
be purchased by the Underwriter and all or any part of the 165,000 preferred
securities subject to the option described in Section 2(b) hereof (the "Optional
Preferred Securities") are hereinafter called, collectively, the "Preferred
Securities." The Preferred Securities are more fully described in the Prospectus
(as defined below).
The Preferred Securities will be guaranteed by American Bancorporation
(the "Company"), to the extent set forth in the Prospectus (as defined below),
with respect to distributions and amounts payable upon liquidation or redemption
(the "Guarantee") pursuant to the Preferred Securities Guarantee Agreement (the
"Guarantee Agreement") to be dated as of Closing Time (as defined below)
executed and delivered by the Company and The Bank of New York (the "Guarantee
Trustee"), a New York banking corporation, not in its individual capacity but
solely as trustee for the benefit of the holders from time
<PAGE>
to time of the Preferred Securities. The Company and the Trust each understand
that the Underwriter proposes to make a public offering of the Preferred
Securities as soon as it deems advisable after this Agreement has been executed
and delivered, and the Trust Agreement (as defined herein), the Indenture (as
defined herein), and the Guarantee Agreement have been qualified under the Trust
Indenture Act of 1939, as amended (the "1939 Act"). The entire proceeds from the
sale of the Preferred Securities will be combined with the entire proceeds from
the sale by the Trust to the Company of its common securities (the "Common
Securities") and will be used by the Trust to purchase the _____% Junior
Subordinated Deferrable Interest Debentures due 2028 (the "Junior Subordinated
Debentures") issued by the Company. The Company will guarantee the full payment
of any costs, expenses or liabilities of the Trust, other than obligations of
the Trust to pay to the holders of Preferred Securities the amounts due to such
holders, pursuant to the Agreement as to Expenses and Liabilities dated as of
the Closing Time between the Trust and the Company ("Expense Agreement"). The
Preferred Securities and the Common Securities will be issued pursuant to the
Amended and Restated Declaration of Trust of the Trust, to be dated as of
Closing Time (the "Trust Agreement"), among the Company, as Sponsor, The Bank of
New York, as property trustee (the "Property Trustee"), The Bank of New York
(Delaware), as Delaware trustee (the "Delaware Trustee"), and Jeremy C. McCamic,
Paul W. Donahie and Brent E. Richmond, as administrative trustees (the
"Administrative Trustees" and together with the Property Trustee and the
Delaware Trustee, the "Trustees"), and the holders from time to time of
undivided beneficial interests in the assets of the Trust. The Junior
Subordinated Debentures will be issued pursuant to an Indenture, to be dated as
of Closing Time (the "Indenture"), between the Company and The Bank of New York,
as debenture trustee (the "Debenture Trustee"). The Preferred Securities, the
Guarantee and the Junior Subordinated Debentures are collectively referred to
herein as the "Securities." The Trust and the Company are collectively referred
to herein as the "Offerors." The Indenture, the Trust Agreement and this
Agreement are collectively referred to herein as the "Operative Documents."
Capitalized terms used herein without definition have the respective meanings
specified in the Prospectus.
The Company and the Trust have filed with the Securities and Exchange
Commission (the "Commission") a registration statement on Form S-2 (Nos.
333-_________ and 333-_______-01) covering the registration of the Securities
under the Securities Act of 1933, as amended (the "1933 Act"), including the
related preliminary prospectus. Promptly after execution and delivery of this
Agreement, the Company will either (i) prepare and file a prospectus in
accordance with the provisions of Rule 430A ("Rule 430A") of the rules and
regulations of the Commission under the 1933 Act (the " 1933 Act Regulations")
and paragraph (b) of Rule 424 ("Rule 424(b)") of the 1933 Act Regulations or
(ii) if the Company and the Trust have elected to rely upon Rule 434 ("Rule
434") of the 1933 Act Regulations, prepare and file a term sheet (a "Term
Sheet") in accordance with the provisions of Rule 434 and Rule 424(b). The
information included in such prospectus or in such Term Sheet, as the case may
be, that was omitted from such registration statement at the time it became
effective but that is deemed to be part of such registration statement at the
time it became effective (a) pursuant to paragraph (b) of Rule 430A is referred
to as
2
<PAGE>
"Rule 430A Information" or (b) pursuant to paragraph (d) of Rule 434 is referred
to as "Rule 434 Information." Each prospectus used before such registration
statement became effective, and any prospectus that omitted, as applicable, the
Rule 430A Information or the Rule 434 Information that was used after such
effectiveness and prior to the execution and delivery of this Agreement, is
herein called a "preliminary prospectus." Such registration statement, including
the exhibits thereto and schedules thereto, if any, at the time it became
effective and including the Rule 430A Information and the Rule 434 Information,
as applicable, is herein called the "Registration Statement." Any registration
statement filed pursuant to Rule 462(b) of the 1933 Act Regulations is herein
referred to as the "Rule 462(b) Registration Statement" and after such filing
the term "Registration Statement" shall include the Rule 462(b) Registration
Statement. The final prospectus in the form first furnished to the Underwriter
for use in connection with the offering of the Preferred Securities is herein
called the "Prospectus." If Rule 434 is relied on, the term "Prospectus" shall
refer to the preliminary prospectus dated March __, 1998 together with the Term
Sheet and all references in this Agreement to the date of the Prospectus shall
mean the date of the Term Sheet. For purposes of this Agreement, all references
to the Registration Statement, any preliminary prospectus, the Prospectus or any
Term Sheet or any amendment or supplement to any of the foregoing shall be
deemed to include the copy filed with the Commission pursuant to its Electronic
Data Gathering, Analysis and Retrieval system ("EDGAR").
The Company understands that the Underwriter proposes to make a public
offering of the Preferred Securities (the "Offering") as soon as possible after
the Registration Statement becomes effective. The Underwriter may assemble and
manage a selling group of broker-dealers that are members of the National
Association of Securities Dealers, Inc. ("NASD") to participate in the
solicitation of purchase orders for the Preferred Securities under the form of a
master selected dealer agreement or similar form of dealer agreement, which the
Underwriter has entered into with such broker dealers.
SECTION 1. REPRESENTATIONS AND WARRANTIES.
(a) The Offerors jointly and severally represent and warrant to the
Underwriter as of the date hereof, as of the Closing Time referred to in Section
2(c) hereof and as of each Date of Delivery (if any) referred to in Section 2(b)
hereof, and agree with the Underwriter as follows:
(i) Compliance with Registration Requirements. The Company
meets the requirements for use of Form S-2 under the 1933 Act and each
of the Registration Statement and any Rule 462(b) Registration
Statement has become effective under the 1933 Act and no stop order
suspending the effectiveness of the Registration Statement or any Rule
462(b) Registration Statement has been issued under the 1933 Act and no
proceedings for that purpose have been instituted or are pending or, to
the knowledge of the Company, are contemplated by the Commission, and
any
3
<PAGE>
request on the part of the Commission for additional information has
been complied with.
At the respective times the Registration Statement,
any Rule 462(b) Registration Statement and any post-effective
amendments thereto became effective and at the Closing Time (and, if
any Optional Preferred Securities are purchased, at the Date of
Delivery), the Registration Statement, the Rule 462(b) Registration
Statement, if any, and any amendments and supplements thereto complied
and will comply in all material respects with the requirements of the
1933 Act and the 1933 Act Regulations and did not and will not contain
an untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements
therein not misleading. Neither the Prospectus nor any amendments or
supplements thereto, at the time the Prospectus or any such amendment
or supplement was issued and at the Closing Time (and, if any Optional
Preferred Securities are purchased, at the Date of Delivery), included
or will include an untrue statement of a material fact or omitted or
will omit to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they
were made, not misleading. If Rule 434 is used, the Company will comply
with the requirements of Rule 434 and the Prospectus shall not be
"materially different," as such term is used in Rule 434, from the
prospectus included in the Registration Statement at the time it became
effective. The representations and warranties in this subsection shall
not apply (A) to statements in or omissions from the Registration
Statement or Prospectus made in reliance upon and in conformity with
information furnished to the Trust or the Company in writing by any
Underwriter through Legg Mason expressly for use in the Registration
Statement or Prospectus and (B) that part of the Registration Statement
which shall constitute the Statements of Eligibility (Forms T-1) under
the 1939 Act.
Each preliminary prospectus and the Prospectus filed
as part of the Registration Statement as originally filed or as part of
any amendment thereto, or filed pursuant to Rule 424 under the 1933
Act, complied when so filed in all material respects with the 1933 Act
Regulations and, if applicable, each preliminary prospectus and the
Prospectus delivered to the Underwriter for use in connection with this
Offering was substantively identical to the electronically transmitted
copies thereof filed with the Commission pursuant to EDGAR, except to
the extent permitted by Regulation S-T.
(ii) The documents incorporated by reference in the Prospectus
pursuant to Item 12 of Form S-2 under the 1933 Act, at the time they
were filed with the Commission, complied in all material respects with
the requirements of the Securities Exchange Act of 1934, as amended
(the "1934 Act"), and the rules and regulations of the Commission
thereunder (the "1934 Act Regulations") and, when read together and
with the other information in the Prospectus, at the time the
Registration Statement becomes effective and at all times subsequent
thereto up to the Closing
4
<PAGE>
Time, will not contain an untrue statement of a material fact or omit
to state a material fact required to be stated therein or necessary in
order to make the statements therein not misleading, in each case after
excluding any statement that does not constitute a part of the
Registration Statement or the Prospectus pursuant to Rule 412 of the
1933 Act Regulations.
(iii) Independent Accountants. The accountants who certified
the financial statements included or incorporated by reference in the
Prospectus are independent public accountants within the meaning of the
1933 Act and the rules and regulations of the Commission under the 1933
Act Regulations.
(iv) Financial Statements. The consolidated historical
financial statements, together with the related schedules and notes,
included in the Prospectus present fairly, in all material respects,
the consolidated financial position of the Company and its consolidated
subsidiaries at the dates indicated, and the statements of income,
changes in stockholders' equity and cash flows of the Company and its
consolidated subsidiaries for the periods specified; said financial
statements have been prepared in conformity with generally accepted
accounting principles ("GAAP") in the United States applied on a
consistent basis throughout the periods involved, except as disclosed
in the notes to such financial statements; the supporting schedules, if
any, included in the Prospectus present fairly, in all material
respects, the information required to be stated therein; and the
summary financial data included in the Prospectus present fairly, in
all material respects, the information shown therein and have been
compiled on a basis consistent with that of the audited financial
statements included in the Prospectus.
(v) No Material Adverse Change in Business. Since the
respective dates as of which information is given in the Prospectus,
except as otherwise stated therein or contemplated thereby, there has
not been (A) any material adverse change in the condition, financial or
otherwise, or in the earnings, business affairs or business prospects
of the Trust, or of the Company and its subsidiaries, considered as one
enterprise, whether or not arising in the ordinary course of business
(a "Material Adverse Effect"), (B) any transaction entered into by the
Trust, the Company or any of its subsidiaries, other than in the
ordinary course of business, that is material to the Trust, or to the
Company and its subsidiaries, considered as one enterprise, or (C) any
dividend or distribution of any kind declared, paid or made by the
Company on any class of its capital stock, other than regular quarterly
dividends on the Company's common stock.
(vi) Good Standing of the Company. The Company has been duly
organized and is validly existing as a corporation in good standing
under the laws of the State of Ohio and has corporate power and
authority to own, lease and operate its properties and to conduct its
business as described in the Prospectus and to enter into and perform
its obligations under each of the Operative Documents to which it
5
<PAGE>
is a party; the Company is duly registered as a bank holding company
under the Bank Holding Company Act of 1956, as amended.
(vii) Good Standing of the Subsidiaries. Wheeling National
Bank (the "Bank") is a national bank duly organized, validly existing
and in good standing under the laws of the United States with corporate
power and authority under such laws to own, lease and operate its
properties and conduct its business; the deposit accounts of the Bank
are insured by the Bank Insurance Fund of the Federal Deposit Insurance
Corporation ("FDIC") up to the maximum allowable limits thereof; each
of American Bancservices, Inc., American Mortgages, Inc., American
Bancleasing, Inc., and American Bancdata Corporation (together with the
Bank, the "Subsidiaries") has been duly organized and is validly
existing as a corporation in good standing under the laws of the State
of Ohio and has corporate power and authority to own, lease and operate
its properties and to conduct its business as described in the
Prospectus .
(viii) No Other Significant Subsidiaries. There are no
"significant subsidiaries" of the Company (as such term is defined in
Rule 1-02 of Regulation S-X) other than the Subsidiaries. The
subsidiaries of the Company other than the Subsidiaries, considered in
the aggregate as a single subsidiary, do not constitute a "significant
subsidiary" as defined in Rule 1-02 of Regulation S-X.
(ix) Foreign Qualifications. The Company and the Subsidiaries
are each duly qualified as a foreign corporation to transact business
and are each in good standing in each jurisdiction in which such
qualification is required, whether by reason of the ownership or
leasing of property or the conduct of business, except where the
failure to so qualify or be in good standing would not result in a
Material Adverse Effect (as defined in Section l(a)(iv) hereof).
(x) Capital Stock Duly Authorized and Validly Issued. All of
the issued and outstanding capital stock of the Company has been duly
authorized and validly issued and is fully paid and nonassessable and
none of the capital stock of the Company was issued in violation of the
preemptive rights of any shareholder of the Company; all of the issued
and outstanding capital stock of the Subsidiaries has been duly
authorized and validly issued, is fully paid and nonassessable and is
owned by the Company, directly or through subsidiaries, free and clear
of any security interest, mortgage, pledge, lien, encumbrance, claim or
equitable right; and none of such outstanding shares of capital stock
of the Subsidiaries was issued in violation of any preemptive or
similar rights arising by operation of law, or under the charter or
by-laws of the Company or the Subsidiaries or under any agreement to
which the Company or any Subsidiary is a party.
(xi) Capitalization. The authorized, issued and outstanding
capital stock of the Company as of December 31, 1997 is as set forth in
the Prospectus under
6
<PAGE>
"Capitalization," and there have not been any subsequent issuances of
capital stock of the Company except for subsequent issuances, if any,
pursuant to any dividend reinvestment plan, reservations, agreements,
conversions, stock dividends or employee or director benefit plans.
(xii) Good Standing of the Trust. The Trust has been duly
created and is validly existing in good standing as a business trust
under the Delaware Act with the power and authority to own property and
the Trust has conducted no business to date, and it will conduct no
business in the future that would be inconsistent with the description
of the Trust set forth in the Prospectus and to enter into and perform
its obligations under the Operative Documents, as applicable, and the
Preferred Securities; the Trust is not a party to or otherwise bound by
any material agreement other than those described in the Prospectus;
and the Trust is, and will be, under current law, classified for United
States federal income tax purposes as a grantor trust and not as an
association taxable as a corporation.
(xiii) Authorization of Common Securities. The Common
Securities have been duly authorized for issuance by the Trust pursuant
to the Trust Agreement and, when certificates therefor have been
issued, executed and authenticated in accordance with the Trust
Agreement and delivered by the Trust to the Company against payment
therefor in accordance with the Common Securities Subscription
Agreement, will be validly issued and fully paid and nonassessable
undivided beneficial ownership interests in the assets of the Trust.
The issuance of the Common Securities is not subject to preemptive or
other similar rights, and, at the Closing Time, all of the issued and
outstanding Common Securities of the Trust will be directly owned by
the Company free and clear of any security interest, mortgage, pledge,
lien, encumbrance, claim or equitable right.
(xiv) Authorization of Preferred Securities. At the Closing
Time, the Preferred Securities will have been duly authorized for
issuance by the Trust pursuant to the Trust Agreement, and the
Preferred Securities, when certificates therefore have been issued,
executed and authenticated in accordance with the Trust Agreement and
delivered against payment therefor as provided herein, will be validly
issued and fully paid and nonassessable undivided beneficial ownership
interests in the assets of the Trust and will conform to the
description thereof in the Prospectus. The issuance of the Preferred
Securities will not be subject to preemptive or other similar rights.
(xv) Authorization of Agreement. This Agreement has been duly
authorized, executed and delivered by the Offerors.
(xvi) Authorization of Trust Agreement. The Trust Agreement
has been qualified under the 1939 Act and has been duly authorized by
the Company and, at the Closing Time, will have been duly executed and
delivered by the Company and
7
<PAGE>
the Trustees, and assuming due authorization, execution and delivery of
the Trust Agreement by the Trustees, the Trust Agreement will, at the
Closing Time, be a valid and binding agreement of the Company,
enforceable against the Company in accordance with its terms, except to
the extent that enforceability may be limited by (a) bankruptcy,
insolvency, reorganization, moratorium, fraudulent conveyance or other
similar laws now or hereafter in effect relating to creditors' rights
generally, (b) general principles of equity (regardless of whether
enforceability is considered in a proceeding at law or in equity) and
(c) any public policy underlying applicable federal or state laws
(collectively, the "Enforceability Exceptions").
(xvii) Authorization of Guarantee and Expense Agreement. The
Guarantee has been qualified under the 1939 Act and has been duly
authorized by the Company; the Expense Agreement has been duly
authorized, executed and delivered by the Offerors; at the Closing
Time, each of the Guarantee and the Expense Agreement will have been
duly executed and delivered by the Company and will constitute a valid
and binding agreement of the Company, enforceable against the Company
in accordance with its terms, except to the extent that enforceability
may be limited by the Enforceability Exceptions; and the Guarantee and
the Expense Agreement will conform in all material respects to the
description thereof in the Prospectus.
(xviii) Authorization of Indenture. The Indenture has been
qualified under the 1939 Act and has been duly authorized by the
Company and, at the Closing Time, will have been duly executed and
delivered by the Company and will constitute a valid, legal and binding
agreement of the Company, enforceable against the Company in accordance
with its terms, except to the extent that enforceability may be limited
by the Enforceability Exceptions.
(xix) Authorization of Debentures. The Junior Subordinated
Debentures have been duly authorized by the Company; at the Closing
Time, the Junior Subordinated Debentures, will have been duly executed
by the Company and, when authenticated in the manner provided for in
the Indenture and delivered by the Company to the Trust against payment
therefor as described in the Prospectus, will constitute valid and
binding obligations of the Company, enforceable against the Company in
accordance with their terms, except to the extent that enforceability
may be limited by the Enforceability Exceptions; and the Junior
Subordinated Debentures will be in the form contemplated by, and
entitled to the benefits of, the Indenture and will conform in all
material respects to the descriptions thereof in the Prospectus.
(xx) Authorization of Trustees. Each of the Administrative
Trustees of the Trust is an officer of the Company and has been duly
authorized by the Company to execute and deliver the Trust Agreement.
8
<PAGE>
(xxi) Trust and Company Not Investment Company. Neither the
Trust nor the Company is, and immediately following consummation of the
transactions contemplated hereby and the application of the net
proceeds as described in the Prospectus neither the Trust nor the
Company will be, an "investment company" or a company "controlled" by
an "investment company" which is required to be registered under the
Investment Company Act of 1940, as amended (the "1940 Act").
(xxii) Accuracy of Disclosure. The Operative Documents
conform in all material respects to the descriptions thereof contained
in the Prospectus.
(xxiii) Absence of Defaults and Conflicts. The Trust is not
in violation of the trust certificate of the Trust filed with the State
of Delaware (the "Trust Certificate") or the Trust Agreement, and
neither the Company nor any Subsidiary is in violation of its charter
or by-laws; none of the Trust, the Company or any Subsidiary is in
default in the performance or observance of any obligation, agreement,
covenant or condition contained in any contract, indenture, mortgage,
deed of trust, loan or credit agreement, note, lease or other agreement
or instrument to which it is a party or by which it or any of them may
be bound, or to which any of its property or assets is subject
(collectively, "Agreements and Instruments") except for such defaults
under Agreements and Instruments that would not result in a Material
Adverse Effect; and the execution, delivery and performance of the
Operative Documents by the Trust or the Company, as the case may be,
the issuance, sale and delivery of the Preferred Securities, the Junior
Subordinated Debentures and the Guarantee, the consummation of the
transactions contemplated by the Operative Documents and compliance by
the Offerors with the terms of the Operative Documents to which they
are a party have been duly authorized by all necessary corporate action
on the part of the Company and, at the Closing Time, will have been
duly authorized by all necessary action on the part of the Trust and do
not and will not, whether with or without the giving of notice or
passage of time or both, violate, conflict with or constitute a breach
of, or default or Repayment Event (as defined below) under, or result
in the creation or imposition of any security interest, mortgage,
pledge, lien, charge, encumbrance, claim or equitable right upon any
property or assets of the Trust, the Company or any of its subsidiaries
pursuant to any of the Agreements and Instruments (except for such
conflicts, breaches or defaults or liens, charges or encumbrances that
would not result in a Material Adverse Effect), nor will such action
result in any violation of the provisions of the charter or by-laws of
the Company or any Subsidiary or the Trust Agreement or the Trust
Certificate, or violation by the Company or any Subsidiary of any
applicable law, statute, rule, regulation, judgment, order, writ or
decree of any government, government authority, agency or
instrumentality or court, domestic or foreign, including, without
limitation, the Board of Governors of the Federal Reserve System, the
Federal Deposit Insurance Corporation and the Office of the Comptroller
of the Currency ("OCC") having jurisdiction over the Trust, the
Company, the Company's subsidiaries, or their respective properties
(collectively, "Governmental Entities"). As used herein, a
9
<PAGE>
"Repayment Event" means any event or condition which gives the holder
of any note, debenture or other evidence of indebtedness (or any person
acting on such holder's behalf) the right to require the repurchase,
redemption or repayment of all or a portion of such indebtedness by the
Trust, the Company or any of its subsidiaries.
(xxiv) Absence of Labor Dispute. No labor dispute with the
employees of the Company or any Subsidiary exists or, to the knowledge
of the Company, is imminent, which may reasonably be expected to result
in a Material Adverse Effect.
(xxv) Absence of Proceedings. There is no action, suit,
proceeding, inquiry or investigation before or brought by any
Governmental Entity now pending, or, to the knowledge of the Trust or
the Company, threatened, against or affecting the Trust or the Company
or any of its subsidiaries, which is not disclosed in the Prospectus
and which in the reasonable judgment of the Trust or the Company might
result in a Material Adverse Effect, or which in the reasonable
judgment of the Company might materially and adversely affect the
properties or assets thereof or the consummation of the transactions
contemplated by the Operative Documents or the performance by the Trust
or the Company of its obligations hereunder or thereunder.
(xxvi) Absence of Further Requirements. No filing with, or
authorization, approval, consent, license, order, registration,
qualification or decree of, any Governmental Entity, other than those
that have been made or obtained, is necessary or required for the
performance by the Trust or the Company of their obligations under the
Operative Documents, as applicable, or the consummation by the Trust
and the Company of the transactions contemplated by the Operative
Documents.
(xxvii) Possession of Licenses and Permits. The Trust, the
Company, the Bank and each Subsidiary possess such permits, licenses,
approvals, consents and other authorizations (collectively,
"Governmental Licenses") issued by the appropriate Governmental
Entities necessary to conduct the business now operated by them; the
Trust, the Company, the Bank and the Subsidiaries are in compliance
with the terms and conditions of all such Governmental Licenses, except
where the failure so to comply would not, singly or in the aggregate
have a Material Adverse Effect; all of the Governmental Licenses are
valid and in full force and effect, except when the invalidity of such
Governmental Licenses or the failure of such Governmental Licenses to
be in full force and effect would not have a Material Adverse Effect;
and neither the Trust, the Company, the Bank nor any Subsidiary has
received any notice of proceedings relating to the revocation or
modification of any such Governmental Licenses which, singly or in the
aggregate, in the reasonable judgment of the Company, is likely to
result in a Material Adverse Effect.
(xxviii) No Other Agreements. Other than such agreements,
contracts and other documents as are described in the Prospectus or
otherwise filed as exhibits to the Company's annual report on Form 10-K
or quarterly reports on Form 10-Q or
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<PAGE>
current reports on Form 8-K incorporated by reference in the
Prospectus, there are no agreements, contracts or documents of a
character described in Item 601 of Regulation S-K of the Commission to
which the Company or the Bank is a party; the Company and the Bank have
no agreement or understanding with any entity concerning the future
acquisition of a controlling interest in the Company or the Bank by any
entity that is required by the 1933 Act or the 1933 Act Regulations to
be disclosed by the Company that is not disclosed in the Prospectus.
(xxix) Title to Property. The Company and the Subsidiaries
have good and marketable title to all of their respective real and
personal properties, in each case free and clear of all liens,
encumbrances and defects, except as stated in the Prospectus, or such
as do not materially affect the value of such properties in the
aggregate to the Company and the Subsidiaries considered as one
enterprise; and all of the leases and sub-leases material to the
business of the Trust, and to the Company and its Subsidiaries,
considered as one enterprise, and under which either of the Offerors or
any Subsidiary holds properties described in the Prospectus, are in
full force and effect and neither the Offerors nor such subsidiaries
have any notice of any material claim of any sort that has been
asserted by anyone adverse to the rights of the Offerors or such
Subsidiaries under any of the leases or subleases mentioned above, or
affecting or questioning the rights of such entity to the continued
possession of the leased or subleased premises under any such lease or
sublease, which individually or in the aggregate might result in a
Material Adverse Effect.
(xxx) Registration Rights. There are no persons with
registration or other similar rights to have any securities of the
Company registered pursuant to the Registration Statement or otherwise
registered by the Company under the 1933 Act.
(xxxi) Patent and Proprietary Rights. Except as disclosed in
the Prospectus, the Company, the Bank and the Subsidiaries own or
possess all patents, patent rights, licenses, inventions, copyrights,
know-how (including trade secrets or other unpatented and/or
unpatentable proprietary or confidential information systems or
procedures), trademarks, servicemarks and tradenames (collectively,
"patent and proprietary rights") currently employed by them in
connection with the business now operated by them except where the
failure to so own, possess or acquire such patent and proprietary
rights would not have a material adverse effect on the condition,
financial or otherwise, or the earnings, business affairs, assets or
business prospects of the Company and its Subsidiaries considered as
one enterprise, and neither the Company, the Bank nor any Subsidiary
has received any notice nor is otherwise aware of any infringement of
or conflict with asserted rights of others with respect to any patent
or proprietary rights, and which infringement or conflict (if the
subject of any unfavorable decision, rule and refinement, singly or in
the aggregate) could reasonably be expected to result in any material
adverse change in the condition, financial or otherwise, or in the
earnings, business affairs, assets or business prospects of the Company
and its Subsidiaries considered as one enterprise.
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(xxxii) Payment of Taxes. The Company, the Bank and each
Subsidiary have filed all Federal, state and local income, franchise or
other tax returns required to be filed and have made timely payments of
all taxes due and payable indicated by such returns and no material
deficiency has been asserted with respect thereto by any taxing
authority.
(xxxiii) NASD Filings. The Company has filed with NASD all
documents and notices required by NASD of companies that have issued
securities that are traded in the over-the-counter market and
quotations for which are reported by the Nasdaq National Market of the
Nasdaq Stock Market ("Nasdaq Stock Market").
(xxxiv) Compliance with Laws and Regulations. Neither the
Company, the Bank nor any Subsidiary is or has been (by virtue of any
action, omission to act, contract to which it is a party or by which it
is bound, or any occurrence or state of facts whatsoever) in violation
of any applicable Federal, state, municipal, or local statutes, laws,
ordinances, rules, regulations and/or orders issued pursuant to
foreign, federal, state, municipal, or local statutes, laws,
ordinances, rules, or regulations (including those relating to any
aspect of banking, bank holding companies, environmental protection,
occupational safety and health, and equal employment practices)
heretofore or currently in effect, except such violation that has been
fully cured or satisfied without recourse or that is not reasonably
likely to have a material adverse effect on the Company, the Bank or
the Subsidiaries.
(xxxv) Regulation M. The Company has not taken and will not
take, directly or indirectly, any action designed to, or that might be
reasonably expected to, cause or result in stabilization or
manipulation of the price of the Preferred Securities.
(b) Any certificate signed by any Trustee of the Trust or any duly
authorized officer of the Company or any of its subsidiaries and delivered to
you or to counsel for the Underwriter shall be deemed a representation and
warranty by the Trust or the Company, as the case may be, to the Underwriter as
to the matters covered thereby.
SECTION 2. SALE AND DELIVERY TO UNDERWRITER; CLOSING.
(a) Initial Preferred Securities. On the basis of the representations
and warranties herein contained and subject to the terms and conditions herein
set forth, the Trust agrees to sell to the Underwriter and the Underwriter
agrees to purchase from the Trust, at the purchase price of $10 per Initial
Preferred Security, the Initial Preferred Securities. As compensation to the
Underwriter for its commitments hereunder and in view of the fact that the
proceeds of the sale of the Preferred Securities will be used to purchase the
Junior Subordinated Debentures, the Company hereby agrees to pay at the Closing
Time and at any Date of Delivery to the Underwriter a commission of $ per
Preferred Security purchased by the Underwriter by wire transfer of immediately
available funds.
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(b) Optional Preferred Securities. In addition, on the basis of the
representations and warranties herein contained and subject to the terms and
conditions herein set forth, the Trust hereby grants an option to the
Underwriter, to purchase up to 165,000 Optional Preferred Securities at the
price per share set forth in the immediately preceding paragraph. The option
hereby granted will expire 30 days after the date hereof and may be exercised in
whole or in part, but only once, solely for the purpose of covering
over-allotments which may be made in connection with the offering and
distribution of the Initial Preferred Securities, upon notice by the Underwriter
to the Trust setting forth the number of Optional Preferred Securities as to
which the Underwriter is exercising the option and the time and date of payment
and delivery for such Optional Preferred Securities. Any such time and date of
delivery (a "Date of Delivery") shall be determined by the Underwriter, but
shall not be later than seven full business days after the exercise of said
option, nor in any event prior to the Closing Time.
(c) Payment. Payment of the purchase price for, and delivery of
certificates for the Initial Preferred Securities shall be made at the offices
of Maloney & Knox in Washington, D.C., or at such other place as shall be agreed
upon by the Underwriter and the Offerors, at 9:00 a.m., Eastern Standard time,
on the third full business day after the effective date of the Registration
Statement, or such other time not later than seven (7) business days after such
date as shall be agreed upon by the Underwriter and the Offerors (such time and
date of payment and delivery being herein called the "Closing Time").
In addition, in the event that any or all of the Optional Preferred
Securities are purchased by the Underwriter, payment of the purchase price for,
and delivery of certificates for, such Optional Preferred Securities shall be
made at the above-mentioned offices, or at such other place as shall be agreed
upon by the Underwriter and the Offerors on the Date of Delivery as specified in
the notice from the Underwriter to the Offerors.
Payment shall be made to the Trust by wire transfer of immediately
available funds, to the order of the Trust, to a bank designated by the Company,
against delivery to the Underwriter of certificates for the Preferred Securities
to be purchased by it.
(d) Denominations; Registration. The Initial Securities shall be issued
in the form of one or more fully registered global securities (the "Global
Securities") in book-entry form in such denominations and registered in the name
of the nominee of The Depository Trust Company ("DTC") or in such names as the
Underwriter may request in writing at least two business days before the Closing
Time or the Option Closing Date, as the case may be. The Global Securities
representing the Initial Securities or the Option Securities to be purchased
will be made available in Washington, D.C. for examination by the Underwriter
and counsel to the Underwriter not later than 10:00 A.M. on the business day
prior to the Closing Time or the Option Closing Date, as the case may be.
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SECTION 3. COVENANTS OF THE OFFERORS.
The Offerors jointly and severally covenant with the Underwriter as
follows:
(a) Compliance with Securities Regulations and Commission Requests. The
Company and the Trust, subject to Section 3(b) hereof, will comply with the
requirements of Rule 430A or Rule 434, as applicable, and will notify the
Underwriter immediately, and confirm the notice in writing, (i) when any
post-effective amendment to the Registration Statement shall become effective,
or any supplement to the Prospectus or any amended Prospectus shall have been
filed, (ii) of the receipt of any comments from the Commission, (iii) of any
request by the Commission for any amendment to the Registration Statement or any
amendment or supplement to the Prospectus or for additional information, and
(iv) of the issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement or of any order preventing or
suspending the use of any preliminary prospectus, or of the suspension of the
qualification of the Preferred Securities for offering or sale in any
jurisdiction, or of the initiation or threatening of any proceedings for any of
such purposes. The Company and the Trust will promptly effect the filings
necessary pursuant to Rule 424(b) and will take such steps as it deems necessary
to ascertain promptly whether the form of prospectus transmitted for filing
under Rule 424(b) was received for filing by the Commission and, in the event
that it was not, it will promptly file such prospectus. The Company and the
Trust will make every reasonable effort to prevent the issuance of any stop
order and, if any stop order is issued, to obtain the lifting thereof at the
earliest possible moment.
(b) Filing of Amendments. The Company and the Trust will give the
Underwriter notice of their intention to file or prepare any amendment to the
Registration Statement (including any filing under Rule 462(b)), any Term Sheet
or any amendment, supplement or revision to either the prospectus included in
the Registration Statement at the time it became effective or to the Prospectus,
whether pursuant to the 1933 Act or otherwise, will furnish the Underwriter with
copies of any such documents a reasonable amount of time prior to such proposed
filing or use, as the case may be, and will not file or use any such document to
which the Underwriter or counsel for the Underwriter shall reasonably object.
(c) Delivery of Registration Statements. The Company has furnished or
will deliver to the Underwriter and counsel for the Underwriter, without charge,
two copies of the Registration Statement as originally filed and of each
amendment thereto (including exhibits filed therewith or incorporated by
reference therein) and copies of all consents and certificates of experts, and
will also deliver to the Underwriter, without charge, a conformed copy of the
Registration Statement as originally filed and of each amendment thereto
(without exhibits). The copies of the Registration Statement and each amendment
thereto furnished to the Underwriter will be substantively identical to the
electronically transmitted copies thereof filed with the Commission pursuant to
EDGAR, except to the extent permitted by Regulation S-T.
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(d) Delivery of Prospectuses. The Offerors, as promptly as possible,
will furnish to the Underwriter, without charge, such number of copies of the
preliminary prospectus, the final Prospectus and any amendments and supplements
thereto and documents incorporated by reference therein as the Underwriter may
reasonably request, and the Company and the Trust hereby consent to the use of
such copies for purposes permitted by the 1933 Act. The Company will furnish to
the Underwriter, without charge, during the period when the Prospectus is
required to be delivered under the 1933 Act or the Securities Exchange Act of
1934 (the "1934 Act"), such number of copies of the Prospectus (as amended or
supplemented) as such Underwriter may reasonably request. The Prospectus and any
amendments or supplements thereto furnished to the Underwriter will be
substantively identical to the electronically transmitted copies thereof filed
with the Commission pursuant to EDGAR, except to the extent permitted by
Regulation S-T.
(e) Continued Compliance with Securities Laws. The Company and the
Trust will comply with the 1933 Act and the 1933 Act Regulations so as to permit
the completion of the distribution of the Securities as contemplated in this
Agreement and in the Prospectus. If at any time when a prospectus is required by
the 1933 Act to be delivered in connection with sales of the Preferred
Securities, any event shall occur or condition shall exist as a result of which
it is necessary, in the opinion of counsel for the Underwriter or for the
Company, to amend the Registration Statement or amend or supplement the
Prospectus in order that the Prospectus will not include any untrue statements
of a material fact or omit to state a material fact necessary in order to make
the statements therein not misleading in the light of the circumstances existing
at the time it is delivered to a purchaser, or if it shall be necessary in the
opinion of such counsel, at any such time to amend the Registration Statement or
amend or supplement the Prospectus in order to comply with the requirements of
the 1933 Act or the 1933 Act Regulations, the Company and the Trust will
promptly prepare and file with the Commission, subject to Section 3(b) hereof,
such amendment or supplement as may be necessary to correct such statement or
omission or to make the Registration Statement or the Prospectus comply with
such requirements, and the Company will furnish to the Underwriter such number
of copies of such amendment or supplement as the Underwriter may reasonably
request.
(f) Blue Sky Qualifications. The Company and the Trust will each use
its best efforts, in cooperation with the Underwriter, to qualify the Preferred
Securities for offering and sale under the applicable securities laws of such
states and other jurisdictions as the Underwriter may reasonably designate and
to maintain such qualifications in effect for a period of not less than one year
from the later of the effective date of the Registration Statement and any Rule
462(b) Registration Statement; provided, however, that neither the Company nor
the Trust shall be obligated to file any general consent to service of process
or to qualify as a foreign corporation or as a dealer in securities in any
jurisdiction in which it is not so qualified or to subject itself to taxation in
respect of doing business in any jurisdiction in which it is not otherwise so
subject. In each jurisdiction in which the Preferred Securities have been so
qualified, the Company and the Trust will file such statements and reports as
may be required by the laws of such jurisdiction to continue such qualification
in
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effect for a period of not less than one year from the later of the effective
date of the Registration Statement and any Rule 462(b) Registration Statement.
(g) Rule 158. The Company will timely file such reports pursuant to the
1934 Act as are necessary in order to make generally available to its
securityholders as soon as practicable an earnings statement for the purposes
of, and to provide the benefits contemplated by, the last paragraph of Section
11(a) of the 1933 Act.
(h) Notice and Effect of Material Events. The Offerors will immediately
notify the Underwriter, and confirm such notice in writing, of (x) any filing
made by the Offerors of information relating to the offering of the Preferred
Securities with any securities exchange or any other regulatory body in the
United States, and (y) prior to the completion of the distribution of the
Preferred Securities by the Underwriter as evidenced by a notice in writing from
the Underwriter to the Offerors, any Material Adverse Effect, which (i) makes
any statement in the Prospectus false or misleading or (ii) is not disclosed in
the Prospectus. In such event or if during such time any event shall occur as a
result of which it is necessary, in the reasonable opinion of the Company, its
counsel or the Underwriter or counsel to the Underwriter, to amend or supplement
the final Prospectus in order that the final Prospectus not include any untrue
statement of a material fact or omit to state a material fact necessary in order
to make the statements therein not misleading in the light of the circumstances
then existing, the Company will forthwith amend or supplement the final
Prospectus by preparing and furnishing to the Underwriter an amendment or
amendments of, or a supplement or supplements to, the final Prospectus (in form
and substance satisfactory in the reasonable opinion of counsel for the
Underwriter) so that, as so amended or supplemented, the final Prospectus will
not include an untrue statement of a material fact or omit to state a material
fact necessary in order to make the statements therein, in the light of the
circumstances existing at the time it is delivered to a Subsequent Purchaser,
not misleading.
(i) DTC. The Offerors will cooperate with the Underwriter and use their
best efforts to permit the Preferred Securities to be eligible for clearance and
settlement through the facilities of DTC.
(j) Use of Proceeds. The Trust will use the proceeds received by it
from the sale of the Securities in the manner specified in the Prospectus under
"Use of Proceeds." The Company will use the net proceeds received by it from the
sale of the Junior Subordinated Debentures, in the manners specified in the
Prospectus under "Use of Proceeds."
(k) Listing. The Company will use its best efforts to effect the
listing of the Preferred Securities on the Nasdaq Stock Market. If the Junior
Subordinated Debentures are distributed on the occurrence of a Tax Event (as
defined in the Prospectus), the Company will use its best efforts to effect the
listing of the Junior Subordinated Debentures on the Nasdaq Stock Market or such
other exchange where the Preferred Securities are listed.
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(l) Restriction on Sale of Securities. During a period of 90 days from
the date of the Prospectus, neither the Company nor the Trust will, without the
prior written consent of Legg Mason, (i) directly or indirectly, offer, pledge,
sell, contract to sell, sell any option or contract to purchase, purchase any
option or contract to sell, grant any option, right or warrant to purchase or
otherwise transfer or dispose of any Preferred Securities or Junior Subordinated
Debentures (or any equity or debt securities substantially similar to the
Preferred Securities or Junior Subordinated Debentures, respectively), or any
securities convertible into or exercisable or exchangeable for Preferred
Securities or Junior Subordinated Debentures (or any equity or debt securities
substantially similar to the Preferred Securities or Junior Subordinated
Debenture, respectively) or file any registration statement under the 1933 Act
with respect to any of the foregoing or (ii) enter into any swap or any other
agreement or any transaction that transfers, in whole or in part, directly or
indirectly, the economic consequence of ownership of Preferred Securities or
Junior Subordinated Debentures (or any equity or debt securities substantially
similar to the Preferred Securities or Junior Subordinated Debentures,
respectively), whether any such swap or transaction described in clause (i) or
(ii) above is to be settled by delivery of Preferred Securities or Junior
Subordinated Debentures (or any equity or debt securities substantially similar
to the Preferred Securities or Junior Subordinated Debentures, respectively) or
such other securities, in cash or otherwise. The foregoing sentence shall not
apply to the Preferred Securities or Junior Subordinated Debentures to be sold
hereunder.
(m) Reporting Requirements. The Company and the Trust, during the
period when the Prospectus is required to be delivered under the 1933 Act or the
1934 Act, will file all documents required to be filed with the Commission
pursuant to Section 13, 14 or 15 of the 1934 Act within the time periods
required by the 1934 Act and the 1934 Act Regulations.
(n) Furnish Reports. For and during the period ending three years after
the effective date of the Registration Statement, the Company will furnish to
the Underwriter copies of all reports and other communications (financial or
otherwise) furnished by the Company to its securityholders generally and copies
of any reports or financial statements furnished to or filed by the Company with
the Commission or any national securities exchange on which any class of
securities of the Company may be listed.
SECTION 4. PAYMENT OF EXPENSES.
(a) Expenses. The Company, as borrower under the Junior Subordinated
Debentures, and pursuant to the Expense Agreement, will pay all expenses
incident to the performance of its, and the Trust's, obligations under this
Agreement, including (i) the preparation, printing and any filing of the
Registration Statement (including financial statements and any schedules or
exhibits and any document incorporated therein by reference) and of each
amendment or supplement thereto, (ii) the preparation, printing and delivery to
the Underwriter of this Agreement, the Operative Documents and such other
documents as may be required in connection with the offering, purchase, sale and
delivery of the
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Preferred Securities, (iii) the preparation, issuance and delivery of the
certificates for the Preferred Securities to the Underwriter, including any
stock or other transfer taxes and any stamp or other duties payable upon the
sale, issuance, or delivery of the Preferred Securities to the Underwriter, (iv)
the fees and disbursements of the Company's counsel, accountants and other
advisors, (v) the fees and expenses of any trustee appointed under any of the
Operative Documents, including the fees and disbursements of counsel for such
trustees in connection with the Operative Documents, (vi) fifty percent of the
fees up to $50,000 of Elias, Matz, Tiernan & Herrick LLP, counsel for the
Underwriter, and for any additional fees of such firm up to an additional
$15,000 to the extent incurred, plus the out-of-pocket expenses and
disbursements incurred by such firm; (vii) the qualification of the Preferred
Securities under securities laws in accordance with the provisions of Section
3(f) hereof, including filing fees and the reasonable fees and disbursements of
counsel for the Underwriter in connection therewith and in connection with the
preparation of the Blue Sky Survey and any supplement thereto, if any, (viii)
the printing and delivery to the Underwriter of copies of each preliminary
prospectus, any Term Sheets and of the Prospectus and any amendments or
supplements thereto, if any, (ix) the fees and expenses of any transfer agent or
registrar for the Preferred Securities, (x) the filing fees incident to the
review by the National Association of Securities Dealers, Inc. (the "NASD") of
the terms of the sale of the Preferred Securities, (xi) the fees and expenses
incurred in connection with the listing of the Preferred Securities and, if
applicable, the Junior Subordinated Debentures on the Nasdaq Stock Market, and
(xii) the cost and charges of qualifying the Preferred Securities with DTC.
(b) Termination of Agreement. If this Agreement is terminated by the
Underwriter in accordance with the provisions of Section 5 or Section 9(a)(i)
hereof, the Company shall reimburse the Underwriter for all of their reasonable,
actual, accountable out-of-pocket expenses, including the reasonable fees and
disbursements of Elias, Matz, Tiernan & Herrick LLP, counsel for the
Underwriter, up to the limit specified in Section 4(a)(vii) hereof.
SECTION 5. CONDITIONS OF UNDERWRITER'S OBLIGATIONS.
The obligations of the Underwriter hereunder are subject to the
accuracy of the representations and warranties of the Offerors contained in
Section 1 hereof or in certificates of any Trustee of the Trust, officer of the
Company or any of its subsidiaries delivered pursuant to the provisions hereof,
to the performance by the Offerors of their obligations hereunder, and to the
following further conditions:
(a) Effectiveness of Registration Statement. The Registration
Statement, including any Rule 462(b) Registration Statement, has become
effective and at Closing Time no stop order suspending the effectiveness of the
Registration Statement shall have been issued under the 1933 Act or proceedings
therefor initiated or threatened by the Commission, and any request on the part
of the Commission for additional information shall have been complied with to
the reasonable satisfaction of counsel to the Underwriter. A
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prospectus containing the Rule 430A Information shall have been filed with the
Commission in accordance with Rule 424(b) (or a post-effective amendment
providing such information shall have been filed and declared effective in
accordance with the requirements of Rule 430(a) or, if the Company has elected
to rely upon Rule 434, a Term Sheet shall have been filed with the Commission in
accordance with Rule 424(b))
(b) Opinion of Outside Counsel for Offerors. At the Closing Time, the
Underwriter shall have received the favorable opinion, dated as of the Closing
Time, of Maloney & Knox, counsel for the Offerors, in form and substance
reasonably satisfactory to the Underwriter, substantially in the form set forth
in Exhibit A. Such counsel may state that, insofar as such opinion involves
factual matters, they have relied, to the extent they deem proper, upon
certificates of Trustees of the Trust, officers of the Company or any designated
subsidiary and certificates of public officials. Such counsel may also state
that, insofar as such opinion involves matters of Ohio and West Virginia law,
they have relied, to the extent they deem proper, on local Ohio and West
Virginia counsel acceptable to counsel to for Underwriter.
(c) Opinion of Special Delaware Counsel for Offerors. At the Closing
Time, the Underwriter shall have received the favorable opinion, dated as of the
Closing Time, of Richards, Layton & Finger, P.A., special Delaware counsel for
the Offerors, in form and substance reasonably satisfactory to counsel for the
Underwriter, substantially in the form set forth in Exhibit B.
(d) Opinion of Counsel for The Bank of New York. At the Closing Time,
the Underwriter shall have received the favorable opinion, dated as of the
Closing Time, of Emmet, Marvin & Martin, LLP, counsel to The Bank of New York,
as Property Trustee under the Trust Agreement, Guarantee Trustee under the
Guarantee Agreement and Debenture Trustee under the Indenture, in form and
substance reasonably satisfactory to counsel for the Underwriter, substantially
in the form set forth in Exhibit C.
(e) Opinion of Special Tax Counsel for the Offerors. At the Closing
Time, the Underwriter shall have received an opinion, dated as of the Closing
Time, of Maloney & Knox, special tax counsel to the Offerors, substantially to
the effect that (i) the Junior Subordinated Debentures will be classified as
indebtedness for United States federal income tax purposes, (ii) the Trust will
be classified as a grantor trust for United States federal income tax purposes,
and (iii) the statements set forth in the Prospectus under the caption "Certain
Federal Income Tax Consequences" constitute, in all material respects, a fair
and accurate summary of the United States federal income tax consequences of the
ownership and disposition of the Preferred Securities under current law. Such
opinion may be conditioned on, among other things, the initial and continuing
accuracy of the facts, financial and other information, covenants and
representations set forth in certificates of officers of the Company and other
documents deemed necessary for such opinion.
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(f) Opinion of Counsel for the Underwriter. At the Closing Time, the
Underwriter shall have received the favorable opinion, dated as of the Closing
Time, of Elias, Matz, Tiernan & Herrick LLP, counsel for the Underwriter, with
respect to the Preferred Securities, the Operative Documents, the Prospectus and
other related matters as the Underwriter may require. Such counsel may also
state that, insofar as such opinion involves factual matters, they have relied,
to the extent they deem proper, upon certificates of Trustees of the Trust,
officers of the Company or the Bank and certificates of public officials.
(g) Certificates. At the Closing Time, there shall not have been, since
the date hereof or since the respective dates as of which information is given
in the Prospectus, any material adverse change in the condition, financial or
otherwise, or in the earnings, business affairs or business prospects of the
Trust, or the Company and its subsidiaries, considered as one enterprise,
whether or not arising in the ordinary course of business, and the Underwriter
shall have received a certificate of the Chairman, the Chief Executive Officer,
the President or any Vice President of the Company and of the Chief Financial
Officer of the Company and a certificate of an Administrative Trustee of the
Trust, dated as of the Closing Time, to the effect that, to his or her knowledge
(i) there has been no such material adverse change (ii) the representations and
warranties in Section 1 hereof were true and correct when made and are true and
correct with the same force and effect as though expressly made at and as of the
Closing Time, and (iii) the Offerors have complied with all agreements and
satisfied all conditions on their part to be performed or satisfied at or prior
to the Closing Time.
(h) Accountant's Comfort Letter. At the time of the execution of this
Agreement, the Initial Purchaser shall have received from KPMG Peat Marwick, LLP
(the "Accountants") a letter dated such date, in form and substance satisfactory
to the Underwriter, containing statements and information of the type ordinarily
included in accountants' "comfort letters" to Underwriter with respect to the
financial statements and certain financial information included or incorporated
by reference in the Prospectus.
(i) Bring-down Comfort Letter. At the Closing Time, the Underwriter
shall have received from the Accountants a letter dated as of the Closing Time,
to the effect that they reaffirm the statements made in the letter furnished
pursuant to subsection (h) of this Section, except that the specified date
referred to shall be a date not more than three business days prior to the
Closing Time.
(j) Approval of Listing. At the Closing Time, the Preferred Securities
shall have been approved for listing on the Nasdaq Stock Market.
(k) Conditions to Purchase of Optional Preferred Securities. In the
event that the Underwriter exercises its option provided in Section 2(b) hereof
to purchase all or any portion of the Optional Preferred Securities, the
representations and warranties of the Company and the Trust contained herein and
the statements in any certificates furnished
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by the Company and any Trustee hereunder shall be true and correct as of the
Date of Delivery and, at the Date of Delivery, the Underwriter shall have
received:
(i) Opinion of Outside Counsel for Offerors. The favorable
opinion of Maloney & Knox, counsel for the Offerors, in form and
substance satisfactory to counsel for the Underwriter, dated such Date
of Delivery, relating to the Optional Preferred Securities to be
purchased on such Date of Delivery and otherwise to the same effect as
the opinion required by Section 5(b) hereof.
(ii) Opinion of Special Delaware Counsel for Offerors. The
favorable opinion, dated such Date of Delivery, of Richards, Layton &
Finger, P.A., special Delaware counsel for the Offerors, in form and
substance satisfactory to counsel for the Underwriter, relating to the
Optional Preferred Securities to be purchased on such Date of Delivery
and otherwise to the same effects as the opinion required by Section
5(c) hereof.
(iii) Opinion of Counsel for The Bank of New York. The
favorable opinion, dated such Date of Delivery, of Emmet, Marvin &
Martin, LLP, counsel to The Bank of New York, as Property Trustee under
the Trust Agreement, Guarantee Trustee under the Guarantee Agreement
and Debenture Trustee under the Indenture, in form and substance
satisfactory to counsel for the Underwriter, relating to the Optional
Preferred Securities to be Purchased on such Date of Delivery and
otherwise to the same effect as the opinion required by Section 5(d)
hereof.
(iv) Opinion of Special Tax Counsel for the Offerors. The
favorable opinion, dated such Date of Delivery, of Maloney & Knox,
special tax counsel to the Offerors, in form and substance satisfactory
to counsel for the Underwriter, relating to the Optional Preferred
Securities to be purchased on such Date of Delivery and otherwise to
the same effect as the opinion required by Section 5(e) hereof.
(v) Opinion of Counsel for the Underwriter. The favorable
opinion, dated such Date of Delivery, of Elias, Matz, Tiernan & Herrick
LLP, counsel for the Underwriter, relating to the Optional Preferred
Securities to be purchased on such Date of Delivery and otherwise to
the same effect as the opinion required by Section 5(f) hereof.
(vi) Certificates. Certificates, dated such Date of Delivery,
of the Chairman, the Chief Executive Officer, the President or any Vice
President of the Company and of the Chief Financial Officer of the
Company and a certificate of an Administrative Trustee of the Trust,
confirming that the certificates delivered at the Closing Time pursuant
to Section 5(g) hereof remain true and correct as of such Date of
Delivery.
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(vii) Bring-down Comfort Letter. A letter from the Accountants
dated such Date of Delivery, in form and substance satisfactory to the
Underwriter, substantially in the same form and substance as the letter
furnished to the Underwriter pursuant to Section 5(i) hereof, except
that the specified date referred to shall be a date not more than five
days prior to such Date of Delivery.
(l) Additional Documents. At the Closing Time, counsel for the
Underwriter shall have been furnished such documents and opinions as they may
reasonably require for the purpose of enabling them to pass upon the issuance
and sale of the Preferred Securities as herein contemplated, or in order to
evidence the accuracy of any of the representations or warranties of the
Offerors, or the fulfillment of any of the conditions, herein contained; and all
proceedings taken by the Offerors in connection with the issuance and sale of
the Preferred Securities as herein contemplated shall be satisfactory in form
and substance to the Underwriter and counsel for the Underwriter.
(m) Termination of Agreement. If any condition specified in this
Section shall not have been fulfilled when and as required to be fulfilled, this
Agreement may be terminated by the Underwriter by notice to the Offerors at any
time at or prior to the Closing Time, and such termination shall be without
liability of any party to any other party except as provided in Section 4 hereof
and except that Sections 7 and 8 hereof shall survive any such termination and
remain in full force and effect.
SECTION 6. INDEMNIFICATION.
(a) Indemnification of Underwriter. The Offerors agree to jointly and
severally indemnify and hold harmless (x) the Underwriter, (y) each person, if
any, who controls the Underwriter within the meaning of Section 15 of the 1933
Act or Section 20 of the 1934 Act (each such person, a "Control Person") and (z)
the respective partners, directors, officers and employees of the Underwriter or
any Control Person as follows:
(i) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, arising out of any untrue statement or
alleged untrue statement of a material fact contained in the
Registration Statement (or any amendment or supplement thereto),
including the Rule 430A Information and the Rule 434 Information, if
applicable, or the omission or alleged omission therefrom of a material
fact required to be stated therein or necessary in order to make the
statements therein, in the light of the circumstances under which they
were made, not misleading or arising out of any untrue statement of a
material fact contained in any preliminary prospectus or the Prospectus
(or any amendment or supplement thereto), or the omission or alleged
omission therefrom of a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they
were made, not misleading;
22
<PAGE>
(ii) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, to the extent of the aggregate amount
paid in settlement of any litigation or any investigation or proceeding
by any governmental agency or body, commenced or threatened, or of any
claim whatsoever based upon any such untrue statement or omission or
any such alleged untrue statement or omission; provided that (subject
to Section 6(d) below) any such settlement is effected with the written
consent of the Offerors; and
(iii) against any and all expense whatsoever, as incurred
(including the fees and disbursements of counsel chosen by the
Underwriter), reasonably incurred in investigating, preparing for or
defending against any litigation or any investigation or proceeding by
any governmental agency or body, commenced or threatened, or any claim
whatsoever based upon any such untrue statement or omission or any such
alleged untrue statement or omission to the extent that any such
expense is not paid under (i) or (ii) above; provided, however, that
this indemnity agreement shall not apply to any loss, liability, claim,
damage or expense to the extent arising out of any untrue statement or
omission or alleged untrue statement or omission made in reliance upon
and in conformity with written information furnished to the Offerors by
the Underwriter expressly for use in the Registration Statement (or any
amendment thereto), including the Rule 430A Information and the Rule
434 Information, if applicable, or any preliminary prospectus or the
Prospectus (or any amendment or supplement thereto). The foregoing
indemnity with respect to any untrue statement or alleged untrue
statement contained in or omission or alleged omission from a
preliminary prospectus shall not inure to the benefit of the
Underwriter (or any person controlling such Underwriter) from whom the
person asserting any loss, liability, claim, damage or expense
purchases any of the Preferred Securities which are the subject thereof
if the Company shall sustain the burden of proving that such person was
not sent or given a copy of the Prospectus (or the Prospectus as
amended or supplemented) at or prior to the written confirmation of the
sale of such Securities to such person and the untrue statement
contained in or omission from such preliminary prospectus was corrected
in the Prospectus (or the Prospectus as amended or supplemented) and
the Company has previously furnished copies thereof to such
Underwriter.
(b) Indemnification of Offerors, Directors, Officers and Employees. The
Underwriter agrees to indemnify and hold harmless the Company, its directors,
officers and employees, the Trust, each of the Trustees and each person, if any,
who controls the Trust, any of the Trustees or the Company within the meaning of
Section 15 of the 1933 Act or Section 20 of the 1934 Act against any and all
loss, liability, claim, damage and expense described in the indemnity contained
in Section 6(a) above, as incurred, but only with respect to untrue statements
or omissions, or alleged untrue statements or omissions, made in the
Registration Statement (or any amendment thereto), including the Rule 430A
Information and the Rule 434 Information, if applicable, or any preliminary
prospectus or the Prospectus (or any amendment or supplement thereto) in
reliance upon and in
23
<PAGE>
conformity with written information furnished to the Offerors by such
Underwriter expressly for use in the Registration Statement (or any amendment
thereto) or such preliminary prospectus or the Prospectus (or any amendment or
supplement thereto).
(c) Actions against Parties; Notification. Each indemnified party shall
give notice as promptly as reasonably practicable to each indemnifying party of
any action commenced against it in respect of which indemnity may be sought
hereunder, but failure to so notify an indemnifying party shall not relieve such
indemnifying party from any liability hereunder to the extent it is not
materially prejudiced as a result thereof, and in any event shall not relieve it
from any liability which it may have otherwise than on account of this indemnity
agreement. An indemnifying party may participate at its own expense in the
defense of any such action or, if it so elects within a reasonable time after
receipt of such notice, to assume the defense of any suit brought to enforce any
such claim, but if it so elects to assume the defense, such defense shall be
conducted by counsel chosen by it and approved by the indemnified parties, which
approval shall not be unreasonably withheld. In the event that an indemnifying
party elects to assume the defense of any such suit and retain such counsel, the
indemnified party or parties shall bear the fees and expenses of any additional
counsel thereafter retained by such indemnified party or parties; provided,
however, that the indemnified party or parties shall have the right to employ
counsel (in addition to local counsel) to represent the indemnified party or
parties who may be subject to liability arising out of any action in respect of
which indemnity may be sought against the indemnifying party if, in the
reasonable judgement of counsel for the indemnified party or parties, there may
be legal defenses available to such indemnified person which are different from
or in addition to those available to such indemnifying person, in which event
the reasonable fees and expenses of appropriate separate counsel shall be borne
by the indemnifying party. In no event shall the indemnifying parties be liable
for fees and expenses of more than one counsel (in addition to any local
counsel) separate from their own counsel for all indemnified parties in
connection with any one action or separate but similar or related actions in the
same jurisdiction arising out of the same general allegations or circumstances.
No indemnifying party shall, without the prior written consent of the
indemnified parties, settle or compromise or consent to the entry of any
judgment with respect to any litigation, or any investigation or proceeding by
any governmental agency or body, commenced or threatened, or any claim
whatsoever in respect of which indemnification or contribution could be sought
under this Section 6 or Section 7 hereof (whether or not the indemnified parties
are actual or potential parties thereto), unless such settlement, compromise or
consent (i) includes an unconditional release of each indemnified party from all
liability arising out of such litigation, investigation, proceeding or claim and
(ii) does not include a statement as to or an admission of fault, culpability or
a failure to act by or on behalf of any indemnified party.
SECTION 7. CONTRIBUTION.
In order to provide for just and equitable contribution in
circumstances under which the indemnification provided for in Section 6 hereof
is for any reason held to be
24
<PAGE>
unenforceable by an indemnified party in respect of any losses, liabilities,
claims, damages or expenses referred to therein, then each indemnifying party
shall contribute to the aggregate amount of such losses, liabilities, claims,
damages and expenses incurred by such indemnified party, as incurred, (i) in
such proportion as is appropriate to reflect the relative benefits received by
the Offerors on the one hand and the Underwriter on the other hand from the
offering of the Preferred Securities pursuant to this Agreement or (ii) if the
allocation provided by clause (i) is not permitted by applicable law, in such
proportion as is appropriate to reflect not only the relative benefits referred
to in clause (i) above but also the relative fault of the Offerors, on the one
hand, and of the Underwriter, on the other hand, in connection with the
statements or omissions which resulted in such losses, liabilities, claims,
damages or expenses, as well as any other relevant equitable considerations.
The relative benefits received by the Offerors on the one hand and the
Underwriter on the other hand in connection with the offering of the Preferred
Securities pursuant to this Agreement shall be deemed to be in the same
respective proportions as the total net proceeds from the offering of the
Preferred Securities pursuant to this Agreement (before deducting expenses)
received by the Offerors and the total commission received by the Underwriter,
bear to the aggregate initial offering price of the Preferred Securities.
The relative fault of the Offerors, on the one hand, and the
Underwriter, on the other hand, shall be determined by reference to, among other
things, whether any such untrue or alleged untrue statements of a material fact
or omission or alleged omission to state a material fact relates to information
supplied by the Offerors or by the Underwriter and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission.
The Offerors and the Underwriter agree that it would not be just and
equitable if contribution pursuant to this Section 7 were determined by pro rata
allocation or by any other method of allocation which does not take account of
the equitable considerations referred to above in this Section 7. The aggregate
amount of losses, liabilities, claims, damages and expenses incurred by an
indemnified party and referred to above in this Section 7 shall be deemed to
include any legal or other expenses reasonably incurred by such indemnified
party in investigating, preparing or defending against any litigation, or any
investigation or proceeding by any governmental agency or body, commenced or
threatened, or any claim whatsoever based upon any such untrue or alleged untrue
statement or omission or alleged omission.
Notwithstanding the provisions of this Section 7, the Underwriter shall
not be required to contribute any amount in excess of the amount by which the
total price at which the Preferred Securities purchased by it and distributed to
the public were offered to the public exceeds the amount of any damages which
the Underwriter has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission.
25
<PAGE>
No person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the 1933 Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation.
For purposes of this Section 7, each person, if any, who controls the
Underwriter within the meaning of Section 15 of the 1933 Act or Section 20 of
the 1934 Act and the respective partners, directors, officers and employees of
the Underwriter shall have the same rights to contribution as the Underwriter,
and each officer, director and employee of the Company, and each person, if any,
who controls the Company within the meaning of Section 15 of the 1933 Act or
Section 20 of the 1934 Act, shall have the same rights to contribution as the
Company.
SECTION 8. REPRESENTATIONS, WARRANTIES AND AGREEMENTS TO SURVIVE DELIVERY.
All representations, warranties and agreements contained in this
Agreement or in certificates of officers of the Company or trustees of the Trust
submitted pursuant hereto, shall remain operative and in full force and effect,
regardless of any investigation made by or on behalf of any Underwriter or
controlling person, or by or on behalf of the Trust or the Company, and shall
survive delivery of the Preferred Securities to the Underwriter.
SECTION 9. TERMINATION OF AGREEMENT.
(a) Termination; General. The Underwriter may terminate this Agreement,
by notice to the Offerors, at any time at or prior to the Closing Time (i) if
there has occurred, since the time of execution of this Agreement or since the
respective dates as of which information is given in the Prospectus, any
material adverse change in the condition, financial or otherwise, or in the
earnings, business affairs or business prospects of the Trust or the Company and
its subsidiaries, considered as one enterprise, whether or not arising in the
ordinary course of business or (ii) if there has occurred any material adverse
change in the financial markets in the United States, any outbreak of
hostilities or escalation thereof or other calamity or crisis, or any change or
development involving a prospective change in national political, financial or
economic conditions, in each case the effect of which is such as to make it, in
the judgment of the Underwriter, impracticable to market the Preferred
Securities or to enforce contracts for the sale of the Preferred Securities, or
(iii) if trading in any securities of the Company has been suspended or limited
by the Commission, or if trading generally on the American Stock Exchange, the
New York Stock Exchange or the Nasdaq Stock Market has been suspended or
limited, or minimum or maximum prices for trading have been fixed, or maximum
ranges for prices have been required, by any of said exchanges or by such system
or by order of the Commission, the National Association of Securities Dealers,
Inc. or any other governmental authority, or (iv) if a banking moratorium has
been declared by either federal, Ohio or West Virginia authorities.
26
<PAGE>
(b) Liabilities. If this Agreement is terminated pursuant to this
Section, such termination shall be without liability of any party to any other
party except as provided in Section 4 hereof, and provided further that Sections
6 and 7 hereof shall survive such termination and remain in full force and
effect.
SECTION 10. NOTICES.
All notices and other communications hereunder shall be in writing and
shall be deemed to have been duly given if mailed or transmitted by any standard
form of telecommunication. Notices to the Underwriter shall be directed to Legg
Mason Wood Walker, Incorporated, 1747 Pennsylvania Avenue N.W., Washington, D.C.
20006, Attention Mark C. Micklem, Managing Director, with a copy to Elias, Matz,
Tiernan & Herrick LLP, 734 15th Street, NW, Washington D.C. 20005, Attention:
Norman B. Antin, Esq.; notices to the Offerors shall be directed to American
Bancorporation, 1025 Main Street, Suite 800, Mull Center, Wheeling, West
Virginia, 26003, Attention: Brent E. Richmond, with a copy to Maloney & Knox,
5225 Wisconsin Avenue, NW, Suite 316, Washington D.C. 20015, Attention: Barry C.
Maloney, Esq.
SECTION 11. PARTIES.
This Agreement shall inure to the benefit of and be binding upon the
Underwriter and the Offerors and their respective successors. Nothing expressed
or mentioned in this Agreement is intended or shall be construed to give any
person, firm or corporation, other than the Underwriter and the Offerors and
their respective successors and the controlling persons and officers and
directors referred to in Sections 1, 6 and 7 hereof and their heirs and legal
representatives, any legal or equitable right, remedy or claim under or in
respect of this Agreement or any provision herein contained. This Agreement and
all conditions and provisions hereof are intended to be for the sole and
exclusive benefit of the Underwriter and the Offerors and their respective
successors, and said controlling persons and officers and directors and their
heirs and legal representatives, and for the benefit of no other person, firm or
corporation. No purchaser of Preferred Securities from the Underwriter shall be
deemed to be a successor by reason merely of such purchase.
The Company, on behalf of itself and its subsidiaries (including,
without limitation, the Trust), hereby irrevocably submits to the exclusive
jurisdiction of the federal and New York State courts located in the City of New
York in connection with any suit, action or proceeding related to this Agreement
or any of the matters contemplated hereby, irrevocably waives any defense of
lack of personal jurisdiction and irrevocably agrees that all claims in respect
of any suit, action or proceeding may be heard and determined in any such court.
The Company, on behalf of itself and the subsidiaries (including, without
limitation, the Trust), irrevocably waives, to the fullest extent it may
effectively do so under applicable law, any objection which it may now or
hereafter have to the laying of venue of any such suit, action or proceeding
brought in any such court and any claim that any such suit, action or proceeding
brought in any such court has been brought in an inconvenient forum.
27
<PAGE>
SECTION 12. GOVERNING LAW.
THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICT OF LAW PRINCIPLES.
SECTION 13. EFFECT OF HEADINGS.
The Article and Section headings herein are for convenience only and
shall not affect the construction hereof.
28
<PAGE>
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to the Company a counterpart hereof, whereupon
this instrument, along with all counterparts, will become a binding agreement
between the Underwriter and the Offerors in accordance with its terms.
Very truly yours,
AMERICAN BANCORPORATION
By:
--------------------------------------
Name: Brent E. Richmond
Title: Executive Vice President and
Chief Financial Officer
AMERICAN BANCORPORATION CAPITAL TRUST I
By:
--------------------------------------
Name: Brent E. Richmond
Title: Administrative Trustee
CONFIRMED AND ACCEPTED,
as of the date first above written:
LEGG MASON WOOD WALKER, INCORPORATED
By: Legg Mason Wood Walker, Incorporated
By:
-------------------------------------
Mark C. Micklem, Managing Director
29
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EXHIBIT A
---------
The opinion of counsel, as counsel for the Offerors to be delivered
pursuant to Section 5(b) of the Underwriting Agreement shall be substantially to
the effect that:
1. The Registration Statement has become effective under the 1933 Act
and no stop order suspending the effectiveness of the Registration Statement has
been issued under the 1933 Act and no proceedings for that purpose have been
instituted or are pending or, to our knowledge, are contemplated by the
Commission. At the time the Registration Statement became effective and at the
Closing Time, the Registration Statement complied in all material respects with
the requirements of the 1933 Act and the 1933 Act Regulations, except that we do
not express any opinion as to the financial statements, schedules and other
financial, statistical or accounting data included or incorporated by reference
therein or the exhibits to the Registration Statement, including the statements
of Eligibility and Qualification under the Trust Indenture Act of 1939, as
amended, on Form T-1 of each of the Property Trustee, the Debenture Trustee and
the Guarantee Trustee (the "Forms T-1"). The Prospectus filed as part of the
Registration Statement as originally filed and as filed pursuant to Rule 424
under the 1933 Act, complied when so filed in all material respects with the
1933 Act Regulations, except that we do not express any opinion as to the
financial statements, schedules and other financial, statistical or accounting
data included or incorporated by reference therein or the exhibits to the
Registration Statement, including the Forms T-1.
2. The Company has been duly incorporated and is existing as a
corporation under the laws of the State of Ohio.
3. The Company has corporate power and authority to own, lease and
operate its properties and to conduct its business as described in the documents
incorporated by reference in the Prospectus and to enter into and perform its
obligations under the Underwriting Agreement.
4. The Company is duly registered as a bank holding company under the
Bank Holding Company Act of 1956, as amended, and, to our knowledge, the Company
possesses the foreign qualifications necessary to carry on the business of the
Company, as described in the documents incorporated by reference in the
Prospectus, except where the failure to have such qualifications would not have
a material adverse effect on the condition (financial or otherwise), earnings,
business affairs or business prospects of the Company and its subsidiaries,
considered as a whole.
5. The Company had at the date indicated a duly authorized
capitalization as set forth in the Prospectus; all of the outstanding shares of
capital stock of the Company have been duly authorized and validly issued and
are fully
<PAGE>
paid and non-assessable; and the stockholders of the Company have no preemptive
rights.
6. The Bank has been duly incorporated and is existing as a national
bank under the laws of the United States and has the corporate power and
authority and foreign qualifications necessary to own, lease and operate its
properties and to conduct its business, as described in the documents
incorporated by reference in the Prospectus, except where the failure to have
such authority or qualifications would not have a material adverse effect on the
condition (financial or otherwise), earnings, business affairs or business
prospects of the Company and its subsidiaries, considered as a whole; all of the
issued and outstanding capital stock of the Bank has been duly authorized and
validly issued, is fully paid and non-assessable and is owned directly by the
Company, free and clear of any security interest, mortgage, pledge, lien,
encumbrance, claim or equity; and none of such shares was issued in violation of
the preemptive rights of any stockholder of the Bank.
7. The Underwriting Agreement has been duly authorized, executed and
delivered by the Trust and the Company.
8. The Trust has been duly created and is validly existing in good
standing as a business trust under the Delaware Trust Act.
9. The Trust Agreement has been duly authorized, executed and delivered
by the Company and the Administrative Trustees and is a valid and binding
obligation of each of the Company and the Administrative Trustees, enforceable
against the Company and the Administrative Trustees in accordance with its terms
except as rights to indemnity and contribution thereunder may be limited under
applicable law, subject to the qualifications that (i) that enforcement of the
Trust Agreement may be limited by bankruptcy, insolvency, reorganization,
moratorium or other laws (including the laws of fraudulent conveyance) or
judicial decisions affecting the enforcement of creditors' rights generally and
(ii) the enforceability of the Company's and the Administrative Trustees'
obligations under the Trust Agreement is subject to general principles of equity
(regardless of whether enforceability is considered in a proceeding at law or in
equity) and to the effect of certain laws and judicial decisions upon the
availability and enforcement of certain remedies, including the remedies of
specific performance and self-help.
10. The Preferred Securities have been duly authorized for issuance by
the Trust; and the Preferred Securities, when executed and authenticated in
accordance with the Trust Agreement and delivered and paid for in accordance
with the Underwriting Agreement, will be validly issued, fully paid and
nonassessable, representing undivided beneficial ownership interests in the
assets of the Trust; and the holders of such Preferred Securities will be
entitled to the same limitation of personal liability extended to stockholders
of private
2
<PAGE>
corporations for profit organized under the General Corporation Law of the State
of Delaware. We bring to your attention, however, that the holders of Preferred
Securities may be obligated, pursuant to the Trust Agreement, to (i) provide
indemnity and/or securities in connection with and pay taxes or governmental
charges arising from transfers of Preferred Securities and (ii) provide security
and indemnity in connection with the requests of or directions to the Property
Trustee to exercise its rights and powers under the Trust Agreement.
11. The Guarantee has been duly authorized, executed and delivered by
the Company and constitutes a valid and binding obligation of the Company,
enforceable against the Company in accordance with its terms, except as rights
to indemnity and contribution thereunder may be limited under applicable law,
subject to the qualifications that (i) enforcement may be limited by bankruptcy,
insolvency, reorganization, moratorium, or other laws (including the laws of
fraudulent conveyance) or judicial decisions affecting the enforcement of
creditors' rights generally and (ii) the enforceability of the Company's
obligations under the Guarantee is subject to general principles of equity
(regardless of whether enforceability is considered in a proceeding at law or in
equity) and to the effect of certain laws and judicial decisions upon the
availability and enforcement of certain remedies, including the remedies of
specific performance and self help.
12. The Indenture has been duly authorized, executed and delivered by
the Company and constitutes a valid and binding obligation of the Company,
enforceable against the Company in accordance with its terms, except as rights
to indemnity and contribution thereunder may be limited under applicable law,
subject to the qualifications that (i) enforcement of the Indenture may be
limited by bankruptcy, insolvency, reorganization, moratorium, or other laws
(including the laws of fraudulent conveyance) or judicial decisions affecting
the enforcement of creditors' rights generally and (ii) the enforceability of
the Company's obligations under the Indenture is subject to general principles
of equity (regardless of whether enforceability is considered in a proceeding at
law or in equity) and to the effect of certain laws and judicial decisions upon
the availability and enforcement of certain remedies, including the remedies of
specific performance and self help.
13. The issuance and sale of the Junior Subordinated Debentures has
been duly authorized by the Company and, when duly executed, authenticated and
issued in accordance with the Indenture and paid for in accordance with the
Debenture Subscription Agreement, will constitute valid and binding obligations
of the Company entitled to the benefits of the Indenture and enforceable against
the Company in accordance with their terms, except as rights to indemnity and
contribution thereunder may be limited under applicable law, subject to the
qualifications that (i) enforcement of the Junior Subordinated Debentures may be
limited by bankruptcy, insolvency, reorganization, moratorium, or other laws
(including the laws of fraudulent conveyance) or judicial decisions affecting
the enforcement of creditors' rights generally and (ii) the enforceability of
the
3
<PAGE>
Company's obligations under the Junior Subordinated Debentures is subject to
general principles of equity (regardless of whether enforceability is considered
in a proceeding at law or in equity) and to the effect of certain laws and
judicial decisions upon the availability and enforcement of certain remedies,
including the remedies of specific performance and self help.
14. At the time the Registration Statement became effective, the
Registration Statement (except for the financial statements, notes to financial
statements, schedules and other financial or statistical information and data
included therein, as to which we express no opinion) complied as to form in all
material respects with the requirements of the 1933 Act and the 1933 Act
Regulations.
During the course of preparation of the Prospectus, we reviewed the
Prospectus and participated in discussions with officers of the Company and the
Bank, and their advisors. We did not participate in the preparation of the
Operative Documents, but have, however, reviewed such documents and discussed
the business and affairs of the Company with officers and representatives of the
Company. Although we have not undertaken to determine independently, and are not
passing upon or assuming any responsibility for, the accuracy, completeness or
fairness of the statements contained in the Prospectus or the Registration
Statement, on the basis of such review and discussions, nothing has come to our
attention that caused us to believe that the Registration Statement (other than
the financial statements, notes to financial statements, schedules and other
financial and statistical information and data included therein or omitted
therefrom, as to which we express no opinion), at the time it became effective
or the date hereof contained or contains an untrue statement of a material fact
or omitted to state a material fact required to be stated therein, or necessary
to make the statements therein, not misleading or that the Prospectus (other
than the financial statements, notes to financial statements, schedules and
other financial and statistical information and data included therein or omitted
therefrom, as to which we express no opinion), as of its date or the date hereof
contained or contains an untrue statement of a material fact or omitted to state
a material fact required to be stated therein, or necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading.
In rendering this opinion letter, we do not express any opinion
concerning any law other than the law of the State of Ohio and the State of West
Virginia, the law of the State of Delaware concerning the treatment of Delaware
business trusts, the corporate law of the State of Delaware and the federal law
of the United States of America and we do not express any opinion concerning the
application of the "doing business" laws or the securities laws of any
jurisdiction other than the federal securities laws of the United States. In
addition, we do not express any opinion on any issue not expressly addressed
above.
4
<PAGE>
EXHIBIT B
---------
The opinion of counsel, as special Delaware counsel to the Offerors and
the Trust to be delivered pursuant to Section 5(c) of the Underwriting Agreement
shall be substantially to the effect that:
1. The Trust has been duly created and is validly existing in good
standing as a business trust under the Delaware Business Trust Act, 12 Del. C.
Section 3801 et seq. (the "Delaware Act"), and all filings required under the
laws of the State of Delaware with respect to the creation and valid existence
of the Trust as a business trust have been made.
2. Under the Delaware Act and the Trust Agreement the Trust has the
trust power and authority to own its property and to conduct its business, all
as described in the Prospectus.
3. The Trust Agreement constitutes a valid and binding obligation of
the Company and the Property Trustee and the Delaware Trustee, and is
enforceable against the Company and such Trustees, in accordance with its terms.
4. Under the Delaware Act and the Trust Agreement, the Trust has the
trust power and authority to execute and deliver, and to perform its obligations
under, the Underwriting Agreement and to issue and perform its obligations under
the Preferred Securities and the Common Securities.
5. Under the Delaware Act and the Trust Agreement, the execution and
delivery by the Trust of the Underwriting Agreement, and the performance by the
Trust of its obligations thereunder, have been duly authorized by all necessary
trust action on the part of the Trust.
6. The Preferred Securities have been duly authorized by the Trust
Agreement and are duly and validly issued and, subject to the qualifications set
forth herein, fully paid and nonassessable undivided beneficial interests in the
assets of the Trust and are entitled to the benefits of the Trust Agreement. The
Holders, as beneficial owners of the Trust, will be entitled to the same
limitations of personal liability extended to stockholders of private
corporations for profit organized under the General Corporation Law of the State
of Delaware. We note that the Holders may be obligated pursuant to the Trust
Agreement, (i) to provide indemnity and/or security in connection with and pay
taxes or governmental charges arising from transfers or exchanges of Preferred
Securities Certificates and the issuance of replacement Preferred Securities
Certificates, and (ii) to provide security or indemnity in connection with
requests of or directions to the Property Trustee to exercise its rights and
powers under the Trust Agreement.
<PAGE>
7. Under the Delaware Act and the Trust Agreement, the issuance of the
Preferred Securities and Common Securities is not subject to preemptive rights.
8. The Common Securities have been duly authorized by the Trust
Agreement and are duly and validly issued undivided beneficial interests in the
assets of the Trust and are entitled to the benefits of the Trust Agreement.
9. The issuance and sale by the Trust of the Preferred Securities and
Common Securities, the purchase by the Trust of the Junior Subordinated
Debentures, the execution, delivery and performance by the Trust of the
Underwriting Agreement, the consummation by the Trust of the transactions
contemplated by the Underwriting Agreement and the compliance by the Trust with
its obligations thereunder will not violate (i) any of the provisions of the
Certificate of Trust or the Trust Agreement or (ii) any applicable Delaware law
or administrative regulation.
10. The Delaware Trustee is duly incorporated, is validly existing in
good standing as a banking corporation with trust powers under the laws of the
State of Delaware and has the corporate power to act as trustee of a Delaware
business trust under the laws of the State of Delaware.
2
<PAGE>
EXHIBIT C
---------
The opinion of counsel to Trust Company and Delaware Trustee to be
delivered pursuant to Section 5(d) of the Underwriting Agreement shall be
substantially to the effect that:
1. The Trust Company is duly incorporated and is validly existing in
good standing as a banking corporation with trust powers under the laws of the
State of New York.
2. The Indenture Trustee has the requisite power and authority to
execute, deliver and perform its obligations under the Indenture, and has taken
all necessary corporate action to authorize the execution, delivery and
performance by it of the Indenture.
3. The Guarantee Trustee has the requisite power and authority to
execute, deliver and perform its obligations under the Guarantee Agreement, and
has taken all necessary corporate action to authorize the execution, delivery
and performance by it of the Guarantee Agreement.
4. The Property Trustee has the requisite power and authority to
execute and deliver the Trust Agreement, and has taken all necessary corporate
action to authorize the execution and delivery of the Trust Agreement.
5. Each of the Indenture and the Guarantee Agreement has been duly
executed and delivered by the Indenture Trustee and the Guarantee Trustee,
respectively, and constitutes a legal, valid and binding obligation of the
Indenture Trustee and the Guarantee Trustee, respectively, enforceable against
the Indenture Trustee and the Guarantee Trustee, respectively, in accordance
with its respective terms, except that certain payment obligations may be
enforceable solely against the assets of the Trust and except that such
enforcement may be limited by bankruptcy, insolvency, reorganization,
moratorium, liquidation, fraudulent conveyance and transfer or other similar
laws affecting the enforcement of creditors' rights generally, and by general
principles of equity, including, without limitation, concepts of materiality,
reasonableness, good faith and fair dealing (regardless of whether such
enforceability, is considered in a proceeding in equity or at law), and by the
affect of applicable public policy on the enforceability of provisions relating
to indemnification or contribution.
6. The Junior Subordinated Debentures delivered on the date hereof have
been duly authenticated by the Indenture Trustee in accordance with the terms of
the Indenture.
EXHIBIT 4.1
-----------
AMERICAN BANCORPORATION
AND
THE BANK OF NEW YORK,
AS TRUSTEE
INDENTURE
_____% JUNIOR SUBORDINATED DEFERRABLE INTEREST DEBENTURES
DUE APRIL ___, 2028
DATED AS OF APRIL ___, 1998
<PAGE>
TABLE OF CONTENTS
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<TABLE>
<CAPTION>
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<S> <C>
ARTICLE I DEFINITIONS 2
Section 1.1 Definitions of Terms 2
ARTICLE II ISSUE, DESCRIPTION, TERMS, CONDITIONS 10
REGISTRATION AND EXCHANGE OF THE DEBENTURES
Section 2.1 Designation And Principal Amount 10
Section 2.2 Maturity 10
Section 2.3 Form And Payment 10
Section 2.4 Interest 11
Section 2.5 Execution And Authentications 12
Section 2.6 Registration of Transfer And Exchange 12
Section 2.7 Temporary Debentures 14
Section 2.7A Global Securities 14
Section 2.8 Mutilated, Destroyed, Lost or Stolen Debentures 15
Section 2.9 Cancellation 16
Section 2.10 Benefit of Indenture 17
Section 2.11 Authentication Agent 17
Section 2.12 Right of Set-off 17
Section 2.13 CUSIP Numbers 18
ARTICLE III REDEMPTION OF DEBENTURES 18
Section 3.1 Redemption 18
Section 3.2 Special Event Redemption 18
Section 3.3 Optional Redemption by Company 19
Section 3.4 Notice of Redemption 19
Section 3.5 Payment Upon Redemption 20
Section 3.6 No Sinking Fund 21
ARTICLE IV EXTENSION OF INTEREST PAYMENT PERIOD 21
Section 4.1 Extension of Interest Payment Period 21
Section 4.2 Notice of Extension 21
Section 4.3 Limitation on Transactions 22
ARTICLE V PARTICULAR COVENANTS OF THE COMPANY 23
Section 5.1 Payment of Principal And Interest 23
Section 5.2 Maintenance of Agency 23
Section 5.3 Paying Agents 23
</TABLE>
i
<PAGE>
<TABLE>
<CAPTION>
Page
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<S> <C>
Section 5.4 Appointment to Fill Vacancy in Office of Trustee 24
Section 5.5 Compliance With Consolidation Provisions 24
Section 5.6 Limitation on Transactions 25
Section 5.7 Covenants as to The Trust 25
Section 5.8 Covenants as to Purchases 26
ARTICLE VI DEBENTURE HOLDERS' LISTS AND REPORTS BY THE 26
COMPANY AND THE TRUSTEES
Section 6.1 Company to Furnish Trustee Names And Addresses of 26
Debenturesholders
Section 6.2 Preservation of Information Communications With Debenture 26
Holders
Section 6.3 Reports by The Company 27
Section 6.4 Reports by The Trustee 27
Section 6.5 Statements As to Default 28
ARTICLE VII REMEDIES OF THE TRUSTEE AND DEBENTURE HOLDERS 28
ON EVENT OF DEFAULT
Section 7.1 Events of Default 28
Section 7.2 Collection of Indebtedness And Suits For Enforcement by Trustee 30
Section 7.3 Application of Moneys Collected 31
Section 7.4 Limitation on Suits 32
Section 7.5 Rights And Remedies Cumulative; Delay or Omission Not Waiver 33
Section 7.6 Control by Debenture Holders 33
Section 7.7 Undertaking to Pay Costs 34
Section 7.8 Direct Action by Holders of Preferred Securities 34
ARTICLE VIII FORM OF DEBENTURE AND ORIGINAL ISSUE 35
Section 8.1 Form of Debenture 35
Section 8.2 Original Issue of Debentures 35
ARTICLE IX CONCERNING THE TRUSTEE 35
Section 9.1 Certain Duties And Responsibilities 35
Section 9.2 Notice of Defaults 36
Section 9.3 Certain Rights of Trustee 37
Section 9.4 Trustee Not Responsible For Recitals, Etc. 38
Section 9.5 May Hold Debentures 38
Section 9.6 Moneys Held in Trust 38
Section 9.7 Compensation And Reimbursement 39
</TABLE>
ii
<PAGE>
<TABLE>
<CAPTION>
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<S> <C>
Section 9.8 Reliance on Officers' Certificate 39
Section 9.9 Disqualification: Conflicting Interests 40
Section 9.10 Corporate Trustee Required Eligibility 40
Section 9.11 Resignation And Removal; Appointment of Successor 40
Section 9.12 Acceptance of Appointment by Successor 42
Section 9.13 Merger, Conversion, Consolidation or Succession to Business 42
Section 9.14 Preferential Collection of Claims Against The Company 43
ARTICLE X CONCERNING THE DEBENTURE HOLDERS 43
Section 10.1 Evidence of Action by Holders 43
Section 10.2 Proof of Execution by Debenture Holders 43
Section 10.3 Who May Be Deemed Owners 44
Section 10.4 Certain Debentures Owned by Company Disregarded 44
Section 10.5 Actions Binding on Future Debenture Holders 45
ARTICLE XI SUPPLEMENTAL INDENTURES 45
Section 11.1 Supplemental Indentures Without The Consent of Debenture 45
Holders
Section 11.2 Supplemental Indentures With Consent of Debenture Holders 46
Section 11.3 Effect of Supplemental Indentures 47
Section 11.4 Debentures Affected by Supplemental Indentures 47
Section 11.5 Execution of Supplemental Indentures 47
ARTICLE XII SUCCESSOR CORPORATION 48
Section 12.1 Company May Consolidate, Etc. 48
Section 12.2 Successor Corporation Substituted 49
Section 12.3 Evidence of Consolidation, Etc. to Trustee 49
ARTICLE XIII SATISFACTION AND DISCHARGE 49
Section 13.1 Satisfaction And Discharge of Indenture 49
Section 13.2 Discharge of Obligations 50
Section 13.3 Deposited Money to Be Held in Trust 50
Section 13.4 Payment of Monies Held by Paying Agents 51
Section 13.5 Repayment to Company 51
ARTICLE XIV IMMUNITY OF INCORPORATORS, STOCKHOLDERS, 51
OFFICERS AND DIRECTORS
Section 14.1 No Recourse 51
</TABLE>
iii
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<S> <C>
ARTICLE XV MISCELLANEOUS PROVISIONS 52
Section 15.1 Effect on Successors And Assigns 52
Section 15.2 Actions by Successor 52
Section 15.3 Surrender of Company Powers 52
Section 15.4 Notices 52
Section 15.5 Governing Law 53
Section 15.6 Treatment of Debentures as Debt 53
Section 15.7 Compliance Certificates And Opinions 53
Section 15.8 Payments on Business Days 53
Section 15.9 Conflict With Trust Indenture Act 54
Section 15.10 Counterparts 54
Section 15.11 Separability 54
Section 15.12 Assignment 54
Section 15.13 Acknowledgment of Rights 54
ARTICLE XVI SUBORDINATION OF DEBENTURES 55
Section 16.1 Agreement to Subordinate 55
Section 16.2 Default on Senior Debt or Subordinated Debt 55
Section 16.3 Liquidation; Dissolution; Bankruptcy 55
Section 16.4 Subrogation 57
Section 16.5 Trustee to Effectuate Subordination 58
Section 16.6 Notice by The Company 58
Section 16.7 Rights of The Trustee; Holders of Senior Indebtedness 59
Section 16.8 Subordination May Not Be Impaired 59
</TABLE>
iv
<PAGE>
CROSS-REFERENCE TABLE
<TABLE>
<CAPTION>
Section of Trust Indenture Act of 1939, as amended Section of Indenture
<S> <C> <C>
310(a) 9.10
310(b) 9.9
9.11
310(c) N/A
311(a) 9.14
311(b) 9.14
311(c) N/A
312(a) 6.1
6.2(a)
312(b) 6.2(c)
312(c) 6.2(c)
313(a) 6.4(a)
313(b) 6.4(b)
313(c) 6.4(a)
6.4(b)
313(d) 6.4(c)
314(a) 6.3(a)
314(b) N/A
314(c) 15.7
314(d) N/A
314(e) 15.7
314(f) N/A
315(a) 9.1(a)
9.3
315(b) 9.2
</TABLE>
v
<PAGE>
<TABLE>
<CAPTION>
Section of Trust Indenture Act of 1939, as amended Section of Indenture
<S> <C> <C>
315(c) 9.1(a)
315(d) 9.1(b)
315(e) 7.7
316(a) 1.1
7.6
316(b) 7.4(b)
316(c) 10.1(b)
317(a) 7.2
317(b) 5.3
318(a) 15.9
</TABLE>
Note: This Cross-Reference Table does not constitute part of this Indenture and
shall not affect the interpretation of any of its terms or provisions.
vi
<PAGE>
INDENTURE
INDENTURE, dated as of April __, 1998, between AMERICAN BANCORPORATION,
an Ohio corporation (the "Company"), and THE BANK OF NEW YORK, a New York
banking corporation (the "Trustee").
RECITALS
WHEREAS, for its lawful corporate purposes, the Company has duly
authorized the execution and delivery of this Indenture to provide for the
issuance of unsecured securities to be known as its ______% Junior Subordinated
Deferrable Interest Debentures due April __, 2028 (hereinafter referred to as
the "Debentures"), the form and substance of such Debentures and the terms,
provisions and conditions thereof to be set forth as provided in this Indenture;
and
WHEREAS, American Bancorporation Capital Trust I, a Delaware statutory
business trust (the "Trust"), has offered to the public $__________ aggregate
liquidation amount of its Preferred Securities (as defined herein) and proposes
to invest the proceeds from such offering, together with the proceeds of the
issuance and sale by the Trust to the Company of $_______ aggregate liquidation
amount of its Common Securities (as defined herein), in $__________ aggregate
principal amount of the Debentures; and
WHEREAS, the Company has requested that the Trustee execute and deliver
this Indenture; and
WHEREAS, all requirements necessary to make this Indenture a valid
instrument in accordance with its terms, and to make the Debentures, when
executed by the Company and authenticated and delivered by the Trustee, the
valid obligations of the Company, have been performed, and the execution and
delivery of this Indenture have been duly authorized in all respects, and
WHEREAS, to provide the terms and conditions upon which the Debentures
are to be authenticated, issued and delivered, the Company has duly authorized
the execution of this Indenture; and
WHEREAS, all things necessary to make this Indenture a valid agreement
of the Company, in accordance with its terms, have been done.
NOW, THEREFORE, in consideration of the premises and the purchase of
the Debentures by the holders thereof, it is mutually covenanted and agreed as
follows for the equal and ratable benefit of the holders of the Debentures and
intending to be legally bound hereby:
<PAGE>
ARTICLE I
DEFINITIONS
SECTION 1.1 DEFINITIONS OF TERMS.
The terms defined in this Section 1.1 (except as in this Indenture
otherwise expressly provided or unless the context otherwise requires) for all
purposes of this Indenture and of any indenture supplemental hereto shall have
the respective meanings specified in this Section 1.1 and shall include the
plural as well as the singular. All other terms used in this Indenture that are
defined in the Trust Indenture Act, or that are by reference in the Trust
Indenture Act defined in the Securities Act (except as herein otherwise
expressly provided or unless the context otherwise requires), shall have the
meanings assigned to such terms in the Trust Indenture Act and in the Securities
Act as in force at the date of the execution of this instrument. All accounting
terms used herein and not expressly defined shall have the meanings assigned to
such terms in accordance with Generally Accepted Accounting Principles as in
effect at the time of computation.
"Additional Interest" shall have the meaning set forth in Section 2.4.
"Administrative Trustees" shall have the meaning set forth in the Trust
Agreement.
"Affiliate" means, with respect to a specified Person, (a) any Person
directly or indirectly owning, controlling or holding with power to vote 10% or
more of the outstanding voting securities or other ownership interests of the
specified Person; (b) any Person 10% or more of whose outstanding voting
securities or other ownership interests are directly or indirectly owned,
controlled or held with power to vote by the specified Person; (c) any Person
directly or indirectly controlling, controlled by, or under common control with
the specified Person; (d) a partnership in which the specified Person is a
general partner; (e) any officer or director of the specified Person; and (f) if
the specified Person is an individual, any entity of which the specified Person
is an executive officer, director or general partner.
"Applicable Procedures" means, with respect to any transfer or
transaction involving a Global Security or beneficial interest therein, the
rules and procedures of the Depositary for such Global Security, in each case to
the extent applicable to such transaction and as in effect from time to time.
"Authenticating Agent" means an authenticating agent with respect to
the Debentures appointed by the Trustee pursuant to Section 2.11.
"Bankruptcy Law" means Title 11, U.S. Code, or any similar federal or
state law for the relief of debtors.
"Board of Directors" means the Board of Directors of the Company or any
duly authorized committee of such Board.
2
<PAGE>
"Board Resolution" means a copy of a resolution certified by the
Secretary or an Assistant Secretary of the Company to have been duly adopted by
the Board of Directors and to be in full force and effect on the date of such
certification.
"Business Day" means, with respect to the Debentures, any day other
than a Saturday or a Sunday or a day on which federal or state banking
institutions in the Borough of Manhattan, The City of New York, or the State of
Delaware are authorized or required by law, executive order or regulation to
close, or a day on which the Corporate Trust Office of the Trustee or the
Property Trustee is closed for business.
"Capital Treatment Event" means the receipt by the Trust of an Opinion
of Counsel to the effect that, as a result of any amendment to, or change
(including any proposed change) in, the laws (or any regulations thereunder) of
the United States or any political subdivision thereof or therein, or as a
result of any official or administrative pronouncement or action or judicial
decision interpreting or applying such laws or regulations, which amendment or
change is effective or such proposed change pronouncement, action or decision is
announced on or after the date of original issuance of the Preferred Securities
under the Trust Agreement, there is more than an insubstantial risk that the
Preferred Securities would not constitute "Tier 1 Capital" (or the then
equivalent thereof) applied as if the Company (or its successor) were a bank
holding company for purposes of the capital adequacy guidelines of the Federal
Reserve (or any successor regulatory authority with jurisdiction over bank
holding companies), or any capital adequacy guidelines as then in effect and
applicable to the Company.
"Certificate" means a certificate signed by the principal executive
officer, the principal financial officer, the principal accounting officer, the
treasurer or any vice president of the Company. The Certificate need not comply
with the provisions of Section 15.7.
"Change in 1940 Act Law" shall have the meaning set forth in the
definition of "Investment Company Event."
"Commission" means the Securities and Exchange Commission, as from time
to time constituted, created under the Exchange Act, or, if at any time after
the execution of this instrument such Commission is not existing and performing
the duties now assigned to it under the Trust Indenture Act, then the body
performing such duties at such time.
"Common Securities" means undivided beneficial interests in the assets
of the Trust which rank pari passu with the Preferred Securities; provided,
however, that upon the occurrence of an Event of Default, the rights of holders
of Common Securities to payment in respect of (i) distributions and (ii)
payments upon liquidation, redemption and otherwise are subordinated to the
rights of holders of Preferred Securities.
"Company" means American Bancorporation, a corporation duly organized
and existing under the laws of the State of Ohio, and, subject to the provisions
of Article XII, shall also include its successors and assigns.
3
<PAGE>
"Compounded Interest" shall have the meaning set forth in Section 4.1.
"Corporate Trust Office" means the office of the Trustee at which, at
any particular time, its corporate trust business shall be principally
administered, which office at the date hereof is located at 101 Barclay Street,
Floor 21 West, New York, New York 10286, Attention: Corporate Trust Trustee
Administration.
"Coupon Rate" shall have the meaning set forth in Section 2.4.
"Custodian" means any receiver, trustee, assignee, liquidator, or
similar official under any Bankruptcy Law.
"Debentures" shall have the meaning set forth in the Recitals hereto.
"Debentureholder," "holder of Debentures," "registered holder," or
other similar term, means the Person or Persons in whose name or names a
particular Debenture shall be registered on the books of the Company or the
Trustee kept for that purpose in accordance with the terms of this Indenture.
"Debenture Register" shall have the meaning set forth in Section
2.6(b).
"Debt" means with respect to any Person, whether recourse is to all or
a portion of the assets of such Person and whether or not contingent, (i) every
obligation of such Person for money borrowed; (ii) every obligation of such
Person evidenced by bonds, debentures, notes or other similar instruments,
including obligations incurred in connection with the acquisition of property,
assets or businesses; (iii) every reimbursement obligation of such Person with
respect to letters of credit, bankers' acceptances or similar facilities issued
for the account of such Person; (iv) every obligation of such Person issued or
assumed as the deferred purchase price of property or services (but excluding
trade accounts payable or accrued liabilities arising in the ordinary course of
business); (v) every capital lease obligation of such Person; (vi) all
indebtedness of such Person, whether incurred on or prior to the date of the
Indenture or thereafter incurred, for claims in respect of derivative products,
including interest rate, foreign exchange rate and commodity forward contracts,
options, swaps and similar arrangements; (vii) every obligation of the type
referred to in clauses (i) through (v) of another Person and all dividends of
another Person the payment of which, in either case, such Person has guaranteed
or is responsible or liable, directly or indirectly, as obligor or otherwise.
"Default" means any event, act or condition that with notice or lapse
of time, or both, would constitute an Event of Default.
"Deferred Interest" shall have the meaning set forth in Section 4.1.
4
<PAGE>
"Depositary" means, with respect to the Debentures issuable or issued
in whole or in part in the form of one or more Global Securities, the Person
designated as Depositary by the Company pursuant to Section 2.3. The initial
Depositary shall be The DTC.
"Dissolution Event" means that as a result of the occurrence and
continuation of a Special Event, the Trust is to be dissolved in accordance with
the Trust Agreement and the Debentures held by the Property Trustee are to be
distributed to the holders of the Trust Securities issued by the Trust pro rata
in accordance with the Trust Agreement.
"DTC" shall mean The Depository Trust Company.
"Event of Default" means, with respect to the Debentures, any event
specified in Section 7.1, which has continued for the period of time, if any,
and after the giving of the notice, if any, therein designated.
"Exchange Act" means the Securities Exchange Act of 1934, or any
successor statute, in each case as amended from time to time.
"Extended Interest Payment Period" shall have the meaning set forth in
Section 4.1.
"Federal Reserve" means the Board of Governors of the Federal Reserve
System.
"Generally Accepted Accounting Principles" means such accounting
principles as are generally accepted at the time of any computation required
hereunder.
"Global Security" means a Debenture evidencing all or part of the
Debentures, issued to the Depositary or its nominee, and registered in the name
of such Depositary or its nominee.
"Governmental Obligations" means securities that are (i) direct
obligations of the United States of America for the payment of which its full
faith and credit is pledged; or (ii) obligations of a Person controlled or
supervised by and acting as an agency or instrumentality of the United States of
America, the payment of which is unconditionally guaranteed as a full faith and
credit obligation by the United States of America that, in either case, are not
callable or redeemable at the option of the issuer thereof, and shall also
include a depositary receipt issued by a bank (as defined in Section 3(a)(2) of
the Securities Act) as custodian with respect to any such Governmental
Obligation or a specific payment of principal of or interest on any such
Governmental Obligation held by such custodian for the account of the holder of
such depositary receipt; provided, however, that (except as required by law)
such custodian is not authorized to make any deduction from the amount payable
to the holder of such depositary receipt from any amount received by the
custodian in respect of the Governmental Obligation or the specific payment of
principal of or interest on the Governmental Obligation evidenced by such
depositary receipt.
5
<PAGE>
"Herein," "hereof," and "hereunder," and other words of similar import,
refer to this Indenture as a whole and not to any particular Article, Section or
other subdivision.
"Indenture" means this instrument as originally executed or as it may
from time to time be supplemented or amended by one or more indentures
supplemental hereto entered into in accordance with the terms hereof.
"Interest Payment Date," when used with respect to any installment of
interest on the Debentures, means the date specified in the Debenture or in a
Board Resolution or in an indenture supplemental hereto with respect to the
Debentures as the fixed date on which an installment of interest with respect to
the Debentures is due and payable.
"Investment Company Act" means the Investment Company Act of 1940, and
any statute successor thereto, in each case as amended from time to time.
"Investment Company Event" means the receipt by the Trust of an Opinion
of Counsel, to the effect that, as a result of the occurrence of a change in law
or regulation or a change in interpretation or application of law or regulation
by any legislative body, court, governmental agency or regulatory authority (a
"Change in 1940 Act Law"), the Trust is or shall be considered an "investment
company" that is required to be registered under the Investment Company Act,
which Change in 1940 Act Law becomes effective on or after the date of original
issuance of the Preferred Securities under the Trust Agreement.
"Maturity Date" means the date on which the Debentures mature and on
which the principal shall be due and payable together with all accrued and
unpaid interest thereon including Compounded Interest and Additional Interest,
if any as set forth in Section 2.2.
"Ministerial Action" shall have the meaning set forth in Section 3.2.
"Officers' Certificate" means a certificate signed by the President or
a Vice President and by the Treasurer or an Assistant Treasurer or the
Controller or an Assistant Controller or the Secretary or an Assistant
Secretary, of the Company, and delivered to the Trustee. Any Officers'
Certificate delivered with respect to compliance with a condition or covenant
provided for in this Indenture shall include:
(a) a statement that each officer signing the Officers'
Certificate has read the covenant or condition and the
definitions relating thereto;
(b) a brief statement of the nature and scope of the examination
or investigation undertaken by each officer in rendering the
Officers' Certificate;
(c) a statement that each such officer has made such examination
or investigation as, in such officer's opinion, is necessary
to enable such officer to express an informed opinion as to
whether or not such covenant or condition has been complied
with; and
6
<PAGE>
(d) a statement as to whether, in the opinion of each such
officer, such condition or covenant has been complied with.
"Opinion of Counsel" means an opinion in writing of independent legal
counsel experienced in such matters as being opined upon, that is delivered to
the Trustee in accordance with the terms hereof.
"Outstanding" when used with reference to the Debentures, means,
subject to the provisions of Section 10.4, as of any particular time, all
Debentures theretofore authenticated and delivered by the Trustee under this
Indenture, except (a) Debentures theretofore canceled by the Trustee or any
paying agent, or delivered to the Trustee or any paying agent for cancellation
or that have previously been canceled; (b) Debentures or portions thereof for
the payment or redemption of which moneys or Governmental Obligations in the
necessary amount shall have been deposited in trust with the Trustee or with any
paying agent (other than the Company) or shall have been set aside and
segregated in trust by the Company (if the Company shall act as its own paying
agent); provided, however, that if such Debentures or portions of such
Debentures are to be redeemed prior to the maturity thereof, notice of such
redemption shall have been given as provided in Article III or provision
satisfactory to the Trustee shall have been made for giving such notice; (c)
Debentures in lieu of or in substitution for which other Debentures shall have
been authenticated and delivered pursuant to the terms of Section 2.6 and (d)
Debentures paid pursuant to Section 2.8.
"Person" means any individual, corporation, partnership,
joint-venture, trust, joint-stock company, unincorporated organization or
government or any agency or political subdivision thereof.
"Place of Payment" means the place or places where the principal of and
interest on the Debentures are payable in accordance with the terms of this
Indenture.
"Predecessor Debenture" means every previous Debenture evidencing all
or a portion of the same debt as that evidenced by such particular Debenture;
and, for the purposes of this definition, any Debenture authenticated and
delivered under Section 2.8 in lieu of a lost, destroyed or stolen Debenture
shall be deemed to evidence the same debt as the lost, destroyed or stolen
Debenture.
"Preferred Securities" means undivided beneficial interests in the
assets of the Trust which rank pari passu with Common Securities issued by the
Trust; provided, however, that upon the occurrence of an Event of Default, the
rights of holders of Common Securities to payment in respect of distributions
and payments upon liquidation, redemption and otherwise are subordinated to the
rights of holders of Preferred Securities.
"Preferred Securities Guarantee" means the Preferred Securities
Guarantee, as amended from time to time, by and between the Company, as
guarantor, and the Trustee, executed and delivered for the benefit of the
Holders of the Preferred Securities.
7
<PAGE>
"Property Trustee" has the meaning set forth in the Trust Agreement.
"Responsible Officer" when used with respect to the Trustee means any
vice president, any assistant vice president, any assistant secretary, any
assistant treasurer, any corporate trust officer or any other officer or
assistant officer of the Trustee customarily performing functions similar to
those performed by the Persons who at the time shall be such officers,
respectively, or to whom any corporate trust matter is referred because of his
or her knowledge of and familiarity with the particular subject.
"Scheduled Maturity Date" means April ___, 2028.
"Securities Act" means the Securities Act of 1933, or any successor
statute, in each case as amended from time to time.
"Senior Debt" means the principal of (and premium, if any) and
interest, if any (including interest accruing on or after the filing of any
petition in bankruptcy or for reorganization relating to the Company whether or
not such claim for post-petition interest is allowed in such proceeding), on
Debt, whether incurred on or prior to the date of this Indenture or thereafter
incurred, unless, in the instrument creating or evidencing the same or pursuant
to which the same is outstanding, it is provided that such obligations are not
superior in right of payment to the Debentures or to other Debt which is pari
passu with, or subordinated to, the Debentures; provided, however, that Senior
Debt shall not be deemed to include (i) any Debt of the Company which when
incurred and without respect to any election under Section 1111 (b) of the
United States Bankruptcy Code of 1978, as amended, was without recourse to the
Company; (ii) any Debt of the Company to any of its subsidiaries; and (iii) any
Debt to any employee of the Company.
"Senior Indebtedness" shall have the meaning set forth in Section 16.1.
"Special Event" means a Tax Event, an Investment Company Event or a
Capital Treatment Event.
"Subordinated Debt" means the principal of (and premium, if any) and
interest, if any (including interest accruing on or after the filing of any
petition in bankruptcy or for reorganization relating to the Company whether or
not such claim for post-petition interest is allowed in such proceeding), on
Debt, whether incurred on or prior to the date of this Indenture or thereafter
incurred, which is by its terms expressly provided to be junior and subordinate
to other Debt of the Company (other than the Debentures), except that
Subordinated Debt shall not include debentures sold by the Company to the Trust.
"Subsidiary" means, with respect to any Person, (i) any corporation at
least a majority of whose outstanding Voting Stock shall at the time be owned,
directly or indirectly, by such Person or by one or more of its Subsidiaries or
by such Person and one or more of its Subsidiaries; (ii) any general
partnership, joint venture, trust or similar entity, at least a majority of
whose
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outstanding partnership or similar interests shall at the time be owned by such
Person, or by one or more of its Subsidiaries, or by such Person and one or more
of its Subsidiaries; and (iii) any limited partnership of which such Person or
any of its Subsidiaries is a general partner.
"Tax Event" means the receipt by the Trust of an Opinion of Counsel, to
the effect that, as a result of any amendment to, or change (including any
announced prospective change) in, the laws (or any regulations thereunder) of
the United States or any political subdivision or taxing authority thereof or
therein, or as a result of any official administrative pronouncement or judicial
decision interpreting or applying such laws or regulations, which amendment or
change is effective or which pronouncement or decision is announced on or after
the date of issuance of the Preferred Securities under the Trust Agreement,
there is more than an insubstantial risk that (i) the Trust is, or shall be
within 90 days after the date of such Opinion of Counsel, subject to United
States federal income tax with respect to income received or accrued on the
Debentures; (ii) interest payable by the Company on the Debentures is not, or
within 90 days after the date of such Opinion of Counsel, shall not be,
deductible by the Company, in whole or in part, for United States federal income
tax purposes; or (iii) the Trust is, or shall be within 90 days after the date
of such Opinion of Counsel, subject to more than a de minimis amount of other
taxes, duties, assessments or other governmental charges. The Trust or the
Company shall request and receive such Opinion of Counsel with regard to such
matters within a reasonable period of time after the Trust or the Company shall
have become aware of the possible occurrence of any of the events described in
clauses (i) through (iii) above.
"Trust" means American Bancorporation Capital Trust I, a Delaware
statutory business trust created by the Trust Agreement.
"Trust Agreement" means the Amended and Restated Trust Agreement, dated
April ___, 1998, of the Trust, as amended, modified or supplemented in
accordance with the applicable provisions thereof, among the trustees of the
trust named therein, the Company, as depositor, and the holders from time to
time of undivided beneficial ownership interests in the assets of the Trust,
including all exhibits thereto, including, for all purposes of the Trust
Agreement, and any such modification, amendment or supplement, the provisions of
the Trust Indenture Act that are deemed to be a part of and govern the Trust
Agreement and any such modification, amendment or supplement, respectively.
"Trustee" means The Bank of New York and, subject to the provisions of
Article IX, shall also include its successors and assigns, and, if at any time
there is more than one Person acting in such capacity hereunder, "'Trustee"
shall mean each such Person.
"Trust Indenture Act" means the Trust Indenture Act of 1939, as
amended, subject to the provisions of Sections 11.1, 11.2, and 12.1 and any
statute successor thereto, in each case as amended from time to time.
"Trust Securities" means the Common Securities and Preferred
Securities, collectively.
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"Voting Stock" as applied to stock of any Person, means shares,
interests, participations or other equivalents in the equity interest (however
designated) in such Person having ordinary voting power for the election of a
majority of the directors (or the equivalent) of such Person, other than shares,
interests, participations or other equivalents having such power only by reason
of the occurrence of a contingency.
ARTICLE II
ISSUE, DESCRIPTION, TERMS, CONDITIONS REGISTRATION
AND EXCHANGE OF THE DEBENTURES
SECTION 2.1 DESIGNATION AND PRINCIPAL AMOUNT.
There is hereby authorized Debentures designated the "______% Junior
Subordinated Deferrable Interest Debentures due April ___, 2028," limited in
aggregate principal amount to $__________ which amount shall be as set forth in
any written order of the Company for the authentication and delivery of
Debentures pursuant to Section 2.5.
SECTION 2.2 MATURITY.
The Maturity Date shall be the Scheduled Maturity Date.
SECTION 2.3 FORM AND PAYMENT.
The Debentures shall be issued in fully registered certificated form
without interest coupons. Principal and interest on the Debentures issued in
certificated form shall be payable, the transfer of such Debentures shall be
registrable and such Debentures shall be exchangeable for Debentures bearing
identical terms and provisions at the office or agency of the Trustee; provided,
however, that payment of interest may be made at the option of the Company by
check mailed to the holder at such address as shall appear in the Debenture
Register or by wire transfer to an account maintained by the holder as specified
in the Debenture Register, provided that the holder provides proper wire
transfer instructions by the regular record date. Notwithstanding the foregoing,
so long as the holder of any Debentures is the Property Trustee, the payment of
the principal of and interest (including Compounded Interest and Additional
Interest, if any) on such Debentures held by the Property Trustee shall be made
at such place and to such account as may be designated by the Property Trustee.
Debentures shall be issuable in whole or in part in the form of one or
more Global Securities and, in such case, the Depositary for such Global
Securities shall be DTC.
SECTION 2.4 INTEREST.
(a) Each Debenture shall bear interest at the rate of _____% per annum
(the "Coupon Rate") from the original date of issuance until the principal
thereof becomes due and payable, and
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on any overdue principal and (to the extent that payment of such interest is
enforceable under applicable law) on any overdue installment of interest at the
Coupon Rate, compounded quarterly, payable (subject to the provisions of Article
IV) quarterly in arrears on March 1, June 1, September 1 and December 1 of each
year (each, an "Interest Payment Date," commencing on ______ __, 1998), to the
Person in whose name such Debenture or any Predecessor Debenture is registered,
at the close of business on the regular record date for such interest
installment, next preceding such Interest Payment Date.
(b) The amount of interest payable for any period shall be computed on
the basis of a 360-day year of twelve 30-day months. Except as provided in the
following sentence, the amount of interest payable for any period shorter than a
full quarterly period for which interest is computed, shall be computed on the
basis of the actual number of days elapsed in such period based on a 30 day
month . In the event that any date on which interest is payable on the
Debentures is not a Business Day, then payment of interest payable on such date
shall be made on the next succeeding day which is a Business Day (and without
any interest or other payment in respect of any such delay), except that, if
such Business Day is in the next succeeding calendar year, such payment shall be
made on the immediately preceding Business Day, in each case with the same force
and effect as if made on the date such payment was originally payable.
(c) If, at any time while the Property Trustee is the holder of any
Debentures, the Trust or the Property Trustee is required to pay any taxes,
duties, assessments or governmental charges of whatever nature (other than
withholding taxes) imposed by the United States, or any other taxing authority,
then, in any case, the Company shall pay as additional interest ("Additional
Interest") on the Debentures held by the Property Trustee, such additional
amounts as shall be required so that the net amounts received and retained by
the Trust and the Property Trustee after paying such taxes, duties, assessments
or other governmental charges shall be equal to the amounts the Trust and the
Property Trustee would have received had no such taxes, duties, assessments or
other governmental charges been imposed.
SECTION 2.5 EXECUTION AND AUTHENTICATIONS.
(a) The Debentures shall be signed on behalf of the Company by its
Chief Executive Officer, President or one of its Vice Presidents, attested by
its Secretary or one of its Assistant Secretaries. Signatures may be in the form
of a manual or facsimile signature. The Company may use the facsimile signature
of any Person who shall have been a Chief Executive Officer, President or Vice
President thereof, or of any Person who shall have been a Secretary or Assistant
Secretary thereof, notwithstanding the fact that at the time the Debentures
shall be authenticated and delivered or disposed of such Person shall have
ceased to be the Chief Executive Officer, President or a Vice President, or the
Secretary or an Assistant Secretary, of the Company. The Debentures may contain
such notations, legends or endorsements required by law, stock exchange rule or
usage. Each Debenture shall be dated the date of its authentication by the
Trustee.
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(b) A Debenture shall not be valid until authenticated manually by an
authorized signatory of the Trustee, or by an Authenticating Agent. Such
signature shall be conclusive evidence that the Debenture so authenticated has
been duly authenticated and delivered hereunder and that the holder is entitled
to the benefits of this Indenture.
(c) At any time and from time to time after the execution and delivery
of this Indenture, the Company may deliver Debentures executed by the Company to
the Trustee for authentication, together with a written order of the Company for
the authentication and delivery of such Debentures signed by its Chief Executive
Officer, President or any Vice President and its Secretary or any Assistant
Secretary, and the Trustee in accordance with such written order shall
authenticate and make available for delivery such Debentures.
(d) In authenticating such Debentures and accepting the additional
responsibilities under this Indenture in relation to such Debentures, the
Trustee shall be entitled to receive, and (subject to Section 9.1) shall be
fully protected in relying upon, an Opinion of Counsel stating that the form and
terms thereof have been established in conformity with the provisions of this
Indenture.
(e) The Trustee shall not be required to authenticate such Debentures
if the issue of such Debentures pursuant to this Indenture shall affect the
Trustee's own rights, duties or immunities under the Debentures and this
Indenture or otherwise in a manner that is not reasonably acceptable to the
Trustee.
SECTION 2.6 REGISTRATION OF TRANSFER AND EXCHANGE.
(a) Debentures may be exchanged upon presentation thereof at the office
or agency of the Company designated for such purpose, for other Debentures and
for a like aggregate principal amount, upon payment of a sum sufficient to cover
any tax or other governmental charge in relation thereto, all as provided in
this Section 2.6. In respect of any Debentures so surrendered for exchange, the
Company shall execute, the Trustee shall authenticate and such office or agency
shall deliver in exchange therefor the Debenture or Debentures that the
Debenture holder making the exchange shall be entitled to receive, bearing
numbers not contemporaneously outstanding.
(b) The Company shall keep, or cause to be kept, at its office or
agency designated for such purpose or such other location designated by the
Company a register or registers (herein referred to as the "Debenture Register")
in which, subject to such reasonable regulations as it may prescribe, the
Company shall register the Debentures and the transfers of Debentures as in this
Article II provided and which at all reasonable times shall be open for
inspection by the Trustee. The registrar for the purpose of registering
Debentures and transfer of Debentures as herein provided shall be appointed as
authorized by Board Resolution (the "Debenture Registrar"). Upon surrender for
transfer of any Debenture at the office or agency of the Company designated for
such purpose, the Company shall execute, the Trustee shall authenticate and such
office or agency shall make available for delivery in the name of the transferee
or transferees a new Debenture
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or Debentures for a like aggregate principal amount. All Debentures presented or
surrendered for exchange or registration of transfer, as provided in this
Section 2.6, shall be accompanied (if so required by the Company or the
Debenture Registrar) by a written instrument or instruments of transfer, in form
satisfactory to the Company or the Debenture Registrar, duly executed by the
registered holder or by such holder's duly authorized attorney in writing.
(c) No service charge shall be made for any exchange or registration of
transfer of Debentures, or issue of new Debentures in case of partial
redemption, but the Company may require payment of a sum sufficient to cover any
tax or other governmental charge in relation thereto, other than exchanges
pursuant to Section 2.7, Section 3.5(b) and Section 11.4 not involving any
transfer.
(d) The Company shall not be required (i) to issue, exchange or
register the transfer of any Debentures during a period beginning at the opening
of business 15 days before the day of the mailing of a notice of redemption of
less than all the Outstanding Debentures and ending at the close of business on
the day of such mailing; nor (ii) to register the transfer of or exchange any
Debentures or portions thereof called for redemption.
(e) Notwithstanding any other provision of this Indenture, transfers
and exchanges of Debentures and beneficial interests in a Global Security shall
be made only in accordance with this Section 2.6(e).
(i) A Debenture that is not a Global Security may be
transferred, in whole or in part, to a Person who takes
delivery in the form of another Debenture that is not a Global
Security as provided in this Section 2.6.
(ii) A beneficial interest in a Global Security may be
exchanged for a Debenture that is not a Global Security as
provided in Section 2.7A.
SECTION 2.7 TEMPORARY DEBENTURES.
Pending the preparation of definitive Debentures, the Company may
execute, and the Trustee shall authenticate and deliver, temporary Debentures
(printed, lithographed, or typewritten). Such temporary Debentures shall be
substantially in the form of the definitive Debentures in lieu of which they are
issued, but with such omissions, insertions and variations as may be appropriate
for temporary Debentures, all as may be determined by the Company. Every
temporary Debenture shall be executed by the Company and be authenticated by the
Trustee upon the same conditions and in substantially the same manner, and with
like effect, as the definitive Debentures. Without unnecessary delay the Company
shall execute and shall furnish definitive Debentures and thereupon any or all
temporary Debentures may be surrendered in exchange therefor (without charge to
the holders), at the office or agency of the Company designated for such
purpose, and the Trustee shall authenticate and such office or agency shall
deliver in exchange for such temporary Debentures an equal aggregate principal
amount of definitive Debentures, unless the Company advises the Trustee to the
effect that definitive
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Debentures need not be executed and furnished until further notice from the
Company. Until so exchanged, the temporary Debentures shall be entitled to the
same benefits under this Indenture as definitive Debentures authenticated and
delivered hereunder.
SECTION 2.7A GLOBAL SECURITIES.
(a) Each Global Security issued under this Indenture shall be
registered in the name of the Depositary designated by the Company for such
Global Security or a nominee thereof and delivered to such Depositary or a
nominee thereof or custodian therefor, and each such Global Security shall
constitute a single Security for all purposes of this Indenture.
(b) Notwithstanding any other provision in this Indenture, no Global
Security may be exchanged in whole or in part for Debentures registered, and no
transfer of a Global Security in whole or in part may be registered, in the name
of any Person other than the Depositary for such Global Security or a nominee
thereof unless (i) such Depositary advises the Trustee in writing that such
Depositary is no longer willing or able to properly discharge its
responsibilities as Depositary with respect to such Global Security, and the
Company is unable to locate a qualified successor, (ii) the Company executes and
delivers to the Trustee a Company Order stating that the Company elects to
terminate the book-entry system through the Depositary, or (iii) there shall
have occurred and be continuing an Event of Default.
(c) If any Global Security is to be exchanged for other Debentures or
cancelled in whole, it shall be surrendered by or on behalf of the Depositary or
its nominee to the Securities Registrar for exchange or cancellation as provided
in this Article II. If any Global Security is to be exchanged for other
Debentures or cancelled in part, or if another Security is to be exchanged in
whole or in part for a beneficial interest in any Global Security, then either
(i) such Global Security shall be so surrendered for exchange or cancellation as
provided in this Article II or (ii) the principal amount thereof shall be
reduced or increased by an amount equal to the portion thereof to be so
exchanged or cancelled, or equal to the principal amount of such Debenture to be
so exchanged for a beneficial interest therein, as the case may be, by means of
an appropriate adjustment made on the records of the Securities Registrar,
whereupon the Trustee, in accordance with Applicable Procedures, shall instruct
the Depositary or its authorized representative to make a corresponding
adjustment to its records. Upon any such surrender or adjustment of a Global
Security by the Depositary, accompanied by registration instructions, the
Trustee shall, subject to Section 2.6 and as otherwise provided in this Article
II, authenticate and make available for delivery any Debentures issuable in
exchange for such Global Security (or any portion thereof) in accordance with
the instructions of the Depositary. The Trustee shall not be liable for any
delay in delivery of such instructions and may conclusively rely on, and shall
be fully protected in relying on, such instructions.
(d) Every Debenture authenticated and delivered upon registration of
transfer of, or in exchange for or in lieu of, a Global Security or any portion
thereof, whether pursuant to this Article II, Section 3.5 or Article IX or
otherwise, shall be authenticated and delivered in the form
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of, and shall be, a Global Security, unless such Debenture is registered in the
name of a Person other than the Depositary for such Global Security or a nominee
thereof.
(e) The Depositary or its nominee, as the registered owner of a Global
Security, shall be the Holder of such Global Security for all purposes under
this Indenture and the Debenture, and owners of beneficial interests in a Global
Security shall hold such interests pursuant to Applicable Procedures.
Accordingly, any such owner's beneficial interest in a Global Security shall be
shown only on, and the transfer of such interest shall be effected only through,
records maintained by the Depositary or its nominee or agent. Neither the
Trustee nor the Securities Registrar shall have any liability in respect of any
transfers effected by the Depositary.
(f) The rights of owners of beneficial interests in a Global Security
shall be exercised only through the Depositary and shall be limited to those
established by law and agreements between such owners and the Depositary and/or
its Agent Members.
SECTION 2.8 MUTILATED, DESTROYED, LOST OR STOLEN DEBENTURES.
(a) In case any temporary or definitive Debenture shall become
mutilated or be destroyed, lost or stolen, the Company (subject to the next
succeeding sentence) shall execute, and upon the Company's request the Trustee
(subject as aforesaid) shall authenticate and make available for delivery, a new
Debenture bearing a number not contemporaneously outstanding, in exchange and
substitution for the mutilated Debenture, or in lieu of and in substitution for
the Debenture so destroyed, lost or stolen. In every case the applicant for a
substituted Debenture shall furnish to the Company and the Trustee such security
or indemnity as may be required by them to save each of them harmless, and, in
every case of destruction, loss or theft, the applicant shall also furnish to
the Company and the Trustee evidence to their satisfaction of the destruction,
loss or theft of the applicant's Debenture and of the ownership thereof. The
Trustee may authenticate any such substituted Debenture and make available for
delivery the same upon the written request or authorization of any officer of
the Company. Upon the issuance of any substituted Debenture, the Company may
require the payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in relation thereto and any other expenses (including
the fees and expenses of the Trustee) connected therewith. In case any Debenture
that has matured or is about to mature shall become mutilated or be destroyed,
lost or stolen, the Company may, instead of issuing a substitute Debenture, pay
or authorize the payment of the same (without surrender thereof except in the
case of a mutilated Debenture) if the applicant for such payment shall furnish
to the Company and the Trustee such security or indemnity as they may require to
save them harmless, and, in case of destruction, loss or theft, evidence to the
satisfaction of the Company and the Trustee of the destruction, loss or theft of
such Debenture and of the ownership thereof.
(b) Every replacement Debenture issued pursuant to the provisions of
this Section 2.8 shall constitute an additional contractual obligation of the
Company whether or not the mutilated, destroyed, lost or stolen Debenture shall
be found at any time, or be enforceable by anyone, and shall be entitled to all
the benefits of this Indenture equally and proportionately with any and all
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other Debentures duly issued hereunder. All Debentures shall be held and owned
upon the express condition that the foregoing provisions are exclusive with
respect to the replacement or payment of mutilated, destroyed, lost or stolen
Debentures, and shall preclude (to the extent lawful) any and all other rights
or remedies, notwithstanding any law or statute existing or hereafter enacted to
the contrary with respect to the replacement or payment of negotiable
instruments or other securities without their surrender.
SECTION 2.9 CANCELLATION.
All Debentures surrendered for the purpose of payment, redemption,
exchange or registration of transfer shall, if surrendered to the Company or any
paying agent, be delivered to the Trustee for cancellation, or, if surrendered
to the Trustee, shall be canceled by it, and no Debentures shall be issued in
lieu thereof except as expressly required or permitted by any of the provisions
of this Indenture. On request of the Company at the time of such surrender, the
Trustee shall deliver to the Company canceled Debentures held by the Trustee. In
the absence of such request the Trustee may dispose of canceled Debentures in
accordance with its standard procedures. If the Company shall otherwise acquire
any of the Debentures, however, such acquisition shall not operate as a
redemption or satisfaction of the indebtedness represented by such Debentures
unless and until the same are delivered to the Trustee for cancellation.
SECTION 2.10 BENEFIT OF INDENTURE.
Nothing in this Indenture or in the Debentures, express or implied,
shall give or be construed to give to any Person, other than the parties hereto
and the holders of the Debentures (and, with respect to the provisions of
Article XVI, the holders of Senior Indebtedness) any legal or equitable right,
remedy or claim under or in respect of this Indenture, or under any covenant,
condition or provision herein contained; all such covenants, conditions, and
provisions being for the sole benefit of the parties hereto and of the holders
of the Debentures (and, with respect to the provisions of Article XVI, the
holders of Senior Indebtedness).
SECTION 2.11 AUTHENTICATION AGENT.
(a) So long as any of the Debentures remain Outstanding there may be an
Authenticating Agent for any or all such Debentures, which the Trustee shall
have the right to appoint. Said Authenticating Agent shall be authorized to act
on behalf of the Trustee to authenticate Debentures issued upon exchange,
transfer or partial redemption thereof, and Debentures so authenticated shall be
entitled to the benefits of this Indenture and shall be valid and obligatory for
all purposes as if authenticated by the Trustee hereunder. All references in
this Indenture to the authentication of Debentures by the Trustee shall be
deemed to include authentication by an Authenticating Agent. Each Authenticating
Agent shall be acceptable to the Company and shall be a corporation that has a
combined capital and surplus, as most recently reported or determined by it,
sufficient under the laws of any jurisdiction under which it is organized or in
which it is doing business to conduct a trust business, and that is otherwise
authorized under such laws to conduct such business and is subject to
supervision or examination
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by federal or state authorities. If at any time any Authenticating Agent shall
cease to be eligible in accordance with these provisions, it shall resign
immediately.
(b) Any Authenticating Agent may at any time resign by giving written
notice of resignation to the Trustee and to the Company. The Trustee may at any
time (and upon request by the Company shall) terminate the agency of any
Authenticating Agent by giving written notice of termination to such
Authenticating Agent and to the Company. Upon resignation, termination or
cessation of eligibility of any Authenticating Agent, the Trustee may appoint an
eligible successor Authenticating Agent acceptable to the Company. Any successor
Authenticating Agent, upon acceptance of its appointment hereunder, shall become
vested with all the rights, powers and duties of its predecessor hereunder as if
originally named as an Authenticating Agent pursuant hereto.
SECTION 2.12 RIGHT OF SET-OFF.
With respect to the Debentures initially issued to the Trust,
notwithstanding anything to the contrary herein, the Company shall have the
right to set-off any payment it is otherwise required to make in respect of any
such Debenture to the extent the Company has theretofore made, or is
concurrently on the date of such payment making, a payment under the Preferred
Securities Guarantee relating to such Debenture or to a holder of Preferred
Securities pursuant to an action undertaken under Section 7.8 of this Indenture.
SECTION 2.13 CUSIP NUMBERS.
The Company in issuing the Debentures may use "CUSIP" numbers (if then
generally in use), and, if so, the Trustee shall use "CUSIP" numbers in notices
of redemption as a convenience to Debentureholders; provided that any such
notice may state that no representation is made as to the correctness of such
numbers either as printed on the Debentures or as contained in any notice of a
redemption and that reliance may be placed only on the other identification
numbers printed on the Debentures, and any such redemption shall not be affected
by any defect in or omission or such numbers. The Company will promptly notify
the Trustee of any change in the CUSIP numbers.
ARTICLE III
REDEMPTION OF DEBENTURES
SECTION 3.1 REDEMPTION.
Subject to the Company having received prior regulatory approval, if
then required under applicable capital guidelines or regulatory policies, the
Company may redeem the Debentures issued hereunder on and after the dates set
forth in and in accordance with the terms of this Article III.
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SECTION 3.2 SPECIAL EVENT REDEMPTION.
Subject to the Company having received prior regulatory approval, if
then required under applicable capital guidelines or regulatory policies, if a
Special Event has occurred and is continuing, then, notwithstanding Section 3.3,
the Company shall have the right upon not less than 30 days nor more than 60
days notice to the holders of the Debentures to redeem the Debentures, in whole
but not in part, for cash within 180 days following the occurrence of such
Special Event (the "180-Day Period") at a redemption price equal to 100% of the
principal amount to be redeemed plus any accrued and unpaid interest thereon to
the date of such redemption (the "Redemption Price"), provided that if at the
time there is available to the Company the opportunity to eliminate, within the
180-Day Period, a Tax Event by taking some ministerial action (a "Ministerial
Action"), such as filing a form or making an election, or pursuing some other
similar reasonable measure which has no adverse effect on the Company, the Trust
or the holders of the Trust Securities issued by the Trust, the Company shall
pursue such Ministerial Action in lieu of redemption, and, provided further,
that the Company shall have no right to redeem the Debentures while the Trust is
pursuing any Ministerial Action pursuant to its obligations under the Trust
Agreement. The Redemption Price shall be paid prior to 12:00 noon, New York
time, on the date of such redemption or such earlier time as the Company
determines, provided that the Company shall deposit with the Trustee an amount
sufficient to pay the Redemption Price by 10:00 a.m., New York time, on the date
such Redemption Price is to be paid.
SECTION 3.3 OPTIONAL REDEMPTION BY COMPANY.
Except as otherwise may be specified in this Indenture, the Company
shall have the right to redeem the Debentures, in whole or in part, from time to
time, on or after April __, 2003, at a Redemption Price equal to 100% of the
principal amount to be redeemed plus any accrued and unpaid interest thereon to
the date of such redemption. Any redemption pursuant to this Section 3.3 shall
be made upon not less than 30 days nor more than 60 days notice to the holder of
the Debentures, at the Redemption Price. If the Debentures are only partially
redeemed pursuant to this Section 3.3, the Debentures shall be redeemed pro rata
or by lot or in such other manner as the Trustee shall deem appropriate and fair
in its discretion. The Redemption Price shall be paid prior to 12:00 noon, New
York time, on the date of such redemption or at such earlier time as the Company
determines provided that the Company shall deposit with the Trustee an amount
sufficient to pay the Redemption Price by 10:00 a.m., New York time, on the date
such Redemption Price is to be paid.
SECTION 3.4 NOTICE OF REDEMPTION.
(a) In case the Company shall desire to exercise such right to redeem
all or a portion of the Debentures in accordance with the right reserved so to
do, the Company shall, or shall cause the Trustee to, upon receipt of 45 days
written notice from the Company, give notice of such redemption to holders of
the Debentures to be redeemed by mailing, first class postage prepaid, a notice
of such redemption not less than 30 days and not more than 60 days before the
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date fixed for redemption to such holders at their last addresses as they shall
appear upon the Debenture Register unless a shorter period is specified in the
Debentures to be redeemed. Any notice that is mailed in the manner herein
provided shall be conclusively presumed to have been duly given, whether or not
the registered holder receives the notice. In any case, failure duly to give
such notice to the holder of any Debenture designated for redemption in whole or
in part, or any defect in the notice, shall not affect the validity of the
proceedings for the redemption of any other Debentures. In the case of any
redemption of Debentures prior to the expiration of any restriction on such
redemption provided in the terms of such Debentures or elsewhere in this
Indenture, the Company shall furnish the Trustee with an Officers' Certificate
evidencing compliance with any such restriction. Each such notice of redemption
shall identify the Debenture to be redeemed (including CUSIP numbers, if any)
and shall specify the date fixed for redemption and the Redemption Price and
shall state that payment of the Redemption Price shall be made at the office or
agency of the Company or at the Corporate Trust Office, upon presentation and
surrender of such Debentures, that interest accrued to the date fixed for
redemption shall be paid as specified in said notice and that from and after
said date interest shall cease to accrue. If less than all the Debentures are to
be redeemed, the notice to the holders of the Debentures shall specify the
particular Debentures to be redeemed. If the Debentures are to be redeemed in
part only, the notice shall state the portion of the principal amount thereof to
be redeemed and shall state that on and after the redemption date, upon
surrender of such Debenture, a new Debenture or Debentures in principal amount
equal to the unredeemed portion thereof shall be issued.
(b) If less than all the Debentures are to be redeemed, the Company
shall give the Trustee at least 45 days notice in advance of the date fixed for
redemption as to the aggregate principal amount of Debentures to be redeemed,
and thereupon the Trustee shall select, by lot or in such other manner as it
shall deem appropriate and fair in its discretion, the portion or portions
(equal to $10 or any integral multiple thereof) of the Debentures to be redeemed
and shall thereafter promptly notify the Company in writing of the numbers of
the Debentures to be redeemed, in whole or in part. The Company may, if and
whenever it shall so elect pursuant to the terms hereof, by delivery of
instructions signed on its behalf by its President or any Vice President,
instruct the Trustee or any paying agent to call all or any part of the
Debentures for redemption and to give notice of redemption in the manner set
forth in this Section 3.4, such notice to be in the name of the Company or its
own name as the Trustee or such paying agent may deem advisable. In any case in
which notice of redemption is to be given by the Trustee or any such paying
agent, the Company shall deliver or cause to be delivered to, or permit to
remain with, the Trustee or such paying agent, as the case may be, such
Debenture Register, transfer books or other records, or suitable copies or
extracts therefrom, sufficient to enable the Trustee or such paying agent to
give any notice by mail that may be required under the provisions of this
Section 3.4.
SECTION 3.5 PAYMENT UPON REDEMPTION.
(a) If the giving of notice of redemption shall have been completed as
above provided, the Debentures or portions of Debentures to be redeemed
specified in such notice shall become
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due and payable on the date and at the place stated in such notice at the
applicable Redemption Price, and interest on such Debentures or portions of
Debentures shall cease to accrue on and after the date fixed for redemption,
unless the Company shall default in the payment of such Redemption Price with
respect to any such Debenture or portion thereof. On presentation and surrender
of such Debentures on or after the date fixed for redemption at the place of
payment specified in the notice, said Debentures shall be paid and redeemed at
the Redemption Price (but if the date fixed for redemption is an interest
payment date, the interest installment payable on such date shall be payable to
the registered holder at the close of business on the applicable record date
pursuant to Section 2.4).
(b) Upon presentation of any Debenture that is to be redeemed in part
only, the Company shall execute and the Trustee shall authenticate and the
office or agency where the Debenture is presented shall make available for
delivery to the holder thereof, at the expense of the Company, a new Debenture
of authorized denomination in principal amount equal to the unredeemed portion
of the Debenture so presented.
SECTION 3.6 NO SINKING FUND.
The Debentures are not entitled to the benefit of any sinking fund.
ARTICLE IV
EXTENSION OF INTEREST PAYMENT PERIOD
SECTION 4.1 EXTENSION OF INTEREST PAYMENT PERIOD.
So long as no Event of Default has occurred and is continuing, the
Company shall have the right, at any time and from time to time during the term
of the Debentures, to defer payments of interest by extending the interest
payment period of such Debentures for a period not exceeding 20 consecutive
quarters (the "Extended Interest Payment Period"), during which Extended
Interest Payment Period no interest shall be due and payable; provided that no
Extended Interest Payment Period may extend beyond the Maturity Date. Interest,
which has been deferred because of the extension of the interest payment period
pursuant to this Section 4.1, shall bear interest thereon at the rate of _____%
per annum, compounded quarterly during the Extended Interest Payment Period (the
"Compounded Interest"). At the end of the Extended Interest Payment Period, the
Company shall calculate (and deliver such calculation to the Trustee) and pay
all interest accrued and unpaid on the Debentures, including any Additional
Interest and Compounded Interest (together, "Deferred Interest") that shall be
payable to the holders of the Debentures in whose names the Debentures are
registered in the Debenture Register on the first record date after the end of
the Extended Interest Payment Period. Before the termination of any Extended
Interest Payment Period, the Company may further extend such period, provided
that such period together with all such further extensions thereof shall not
exceed 20 consecutive quarters, or extend beyond the Maturity Date of the
Debentures. Upon the termination of any Extended Interest Payment Period and
upon the payment of all Deferred Interest then due, the
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Company may commence a new Extended Interest Payment Period, subject to the
foregoing requirements. No interest shall be due and payable during an Extended
Interest Payment Period, except at the end thereof, but the Company may prepay
at any time all or any portion of the interest accrued during an Extended
Interest Payment Period.
SECTION 4.2 NOTICE OF EXTENSION.
(a) If the Property Trustee is the only registered holder of the
Debentures at the time the Company selects an Extended Interest Payment Period,
the Company shall give written notice to the Administrative Trustees, the
Property Trustee and the Trustee of its selection of such Extended Interest
Payment Period one Business Day before the earlier of (i) the next succeeding
date on which Distributions on the Trust Securities issued by the Trust are
payable; or (ii) the date the Trust is required to give notice of the record
date or the date such Distributions are payable to The Nasdaq Stock Market's
National Market of other applicable self-regulatory organization or to holders
of the Preferred Securities issued by the Trust, but in any event at least one
Business Day before such record date.
(b) If the Property Trustee is not the only holder of the Debentures at
the time the Company selects an Extended Interest Payment Period, the Company
shall give the holders of the Debentures and the Trustee written notice of its
selection of such Extended Interest Payment Period at least one Business Day
before the earlier of (i) the next succeeding Interest Payment Date; or (ii) the
date the Company is required to give notice of the record or payment date of
such interest payment to The Nasdaq Stock Market's National Market or other
applicable self-regulatory organization or to holders of the Debentures.
(c) The quarter in which any notice is given pursuant to paragraphs (a)
or (b) of this Section 4.2 shall be counted as one of the 20 quarters permitted
in the Minimum Extended Interest Payment Period permitted under Section 4.1.
SECTION 4.3 LIMITATION ON TRANSACTIONS.
If (i) the Company shall exercise its right to defer payment of
interest as provided in Section 4.1; (ii) there shall have occurred any Event of
Default; or (iii) the Company is in default with respect to its obligations
under the Preferred Securities Guarantee, then (a) the Company will not, and
will not permit any Subsidiary to, declare or pay any dividends or distributions
on, or redeem, purchase, acquire or make a liquidation payment with respect to,
any of the Company's capital stock (other than (1) the reclassification of any
class of the Company's capital stock into another class of its capital stock;
(2) dividends or distributions payable in any class of the Company's common
stock, (3) any declaration of a dividend in connection with the implementation
of a shareholder rights plan, or the issuance of stock under any such plan in
the future, or the redemption or repurchase of any such rights pursuant thereto,
(4) payments under the Preferred Securities Guarantee and (5) purchases of the
Company's common stock related to the rights under any of the Company's benefit
plans for its or its subsidiaries' directors, officers or employees); (b) the
Company will not, and will not permit any Subsidiary to, make any
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payment of interest, principal or premium, if any, or repay, repurchase or
redeem any debt securities issued by the Company which rank pari passu with or
junior to the Debentures or make any guarantee payments with respect to any
guarantee by the Company of the debt securities of any Subsidiary of the Company
if such guarantee ranks pari passu with or junior to the Debentures; provided,
however, that notwithstanding the foregoing the Company may make payments
pursuant to its obligations under the Preferred Securities Guarantee; and (c)
the Company shall not redeem, purchase or acquire less than all of the
outstanding Debentures or any of the Preferred Securities.
ARTICLE V
PARTICULAR COVENANTS OF THE COMPANY
SECTION 5.1 PAYMENT OF PRINCIPAL AND INTEREST.
The Company shall duly and punctually pay or cause to be paid the
principal of and interest on the Debentures at the time and place and in the
manner provided herein.
SECTION 5.2 MAINTENANCE OF AGENCY.
So long as any of the Debentures remain Outstanding, the Company shall
maintain an office or agency in the Place of Payment where (i) Debentures may be
presented for payment; (ii) Debentures may be presented as hereinabove
authorized for registration of transfer and exchange; and (iii) notice and
demands to or upon the Company in respect of the Debentures and this Indenture
may be given or served, such designation to continue with respect to such office
or agency until the Company shall, by written notice signed by its President or
a Vice President and delivered to the Trustee, designate some other office or
agency for such purposes or any of them. If at any time the Company shall fail
to maintain any such required office or agency or shall fail to furnish the
Trustee with the address thereof, such presentations, notices and demands may be
made or served at the Corporate Trust Office of the Trustee, and the Company
hereby appoints the Trustee as its agent to receive all such presentations,
notices and demands. In addition to any such office or agency, the Company may
from time to time designate one or more offices or agencies where the Debentures
may be presented for registration or transfer and for exchange in the manner
provided herein, and the Company may from time to time rescind such designation
as the Company may deem desirable or expedient; provided, however, that no such
designation or rescission shall in any manner relieve the Company of its
obligation to maintain any such office or agency in the Place of Payment for
such purposes. The Company shall give the Trustee prompt written notice of any
such designation or rescission thereof.
SECTION 5.3 PAYING AGENTS.
(a) If the Company shall appoint one or more paying agents for the
Debentures, other than the Trustee, the Company shall cause each such paying
agent to execute and deliver to the
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Trustee an instrument in which such agent shall agree with the Trustee, subject
to the provisions of this Section 5.3:
(i) that it shall hold all sums held by it as such agent for
the payment of the principal of or interest on the Debentures
(whether such sums have been paid to it by the Company or by
any other obligor of such Debentures) in trust for the benefit
of the Persons entitled thereto;
(ii) that it shall give the Trustee prompt written notice of
any failure by the Company (or by any other obligor of such
Debentures) to make any payment of the principal of or
interest on the Debentures when the same shall be due and
payable;
(iii) that it shall, at any time during the continuance of any
failure referred to in the preceding paragraph (a)(ii) above,
upon the written request of the Trustee, forthwith pay to the
Trustee all sums so held in trust by such paying agent; and
(iv) that it shall perform all other duties of paying agent as
set forth in this Indenture.
(b) If the Company shall act as its own paying agent with respect to
the Debentures, it shall on or before each due date of the principal of or
interest on such Debentures, set aside, segregate and hold in trust for the
benefit of the Persons entitled thereto a sum sufficient to pay such principal
or interest so becoming due on Debentures until such sums shall be paid to such
Persons or otherwise disposed of as herein provided and shall promptly notify
the Trustee of such action, or any failure (by it or any other obligor on such
Debentures) to take such action. Whenever the Company shall have one or more
paying agents for the Debentures, it shall, prior to each due date of the
principal of or interest on any Debentures, deposit with the paying agent a sum
sufficient to pay the principal or interest so becoming due, such sum to be held
in trust for the benefit of the Persons entitled to such principal or interest,
and (unless such paying agent is the Trustee) the Company shall promptly notify
the Trustee of this action or failure so to act.
(c) Notwithstanding anything in this Section 5.3 to the contrary, (i)
the agreement to hold sums in trust as provided in this Section 5.3 is subject
to the provisions of Section 13.3 and 13.4; and (ii) the Company may at any
time, for the purpose of obtaining the satisfaction and discharge of this
Indenture or for any other purpose, pay, or direct any paying agent to pay, to
the Trustee all sums held in trust by the Company or such paying agent, such
sums to be held by the Trustee upon the same terms and conditions as those upon
which such sums were held by the Company or such paying agent; and, upon such
payment by any paying agent to the Trustee, such paying agent shall be released
from all further liability with respect to such money.
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SECTION 5.4 APPOINTMENT TO FILL VACANCY IN OFFICE OF TRUSTEE.
The Company, whenever necessary to avoid or fill a vacancy in the
office of Trustee, shall appoint, in the manner provided in Section 9.10, a
Trustee, so that there shall at all times be a Trustee hereunder.
SECTION 5.5 COMPLIANCE WITH CONSOLIDATION PROVISIONS.
The Company shall not, while any of the Debentures remain outstanding,
consolidate with, or merge into, or merge into itself, or convey, transfer or
lease all or substantially all of its property and assets to any other entity
and no entity shall consolidate with or merge into the Company or convey,
transfer or lease substantially all of its properties and assets to the Company,
unless the provisions of Article XII hereof are complied with.
SECTION 5.6 LIMITATION ON TRANSACTIONS.
If Debentures are issued to the Trust or a trustee of the Trust in
connection with the issuance of Trust Securities by the Trust and (i) there
shall have occurred any event that would constitute an Event of Default; (ii)
the Company shall be in default with respect to its payment of any obligations
under the Preferred Securities Guarantee relating to the Trust; or (iii) the
Company shall have given notice of its election to defer payments of interest on
such Debentures by extending the interest payment period as provided in this
Indenture and such period, or any extension thereof, shall be continuing, then
(a) the Company may not, and may not permit any Subsidiary to, declare or pay
any dividend on, make any distributions with respect to, or redeem, purchase,
acquire or make a liquidation payment with respect to, any of its capital stock
(other than (1) the reclassification of any class of the Company's capital stock
into another class of capital stock, (2) dividends or distributions payable in
any class of the Company's common stock, (3) any declaration of a dividend in
connection with the implementation of a shareholder rights plan, or the issuance
of stock under any such plan in the future, or the redemption or repurchase of
any such rights pursuant thereto, (4) payments under the Preferred Securities
Guarantee and (5) purchases of the Company's common stock related to the rights
under any of the Company's benefit plans for its or its subsidiaries' directors,
officers or employees); (b) the Company shall not make any payment of interest,
principal or premium, if any, or repay, repurchase or redeem any debt securities
issued by the Company which rank pari passu with or junior to the Debentures;
provided, however, that the Company may make payments pursuant to its
obligations under the Preferred Securities Guarantee; and (c) the Company shall
not redeem, purchase or acquire less than all of the outstanding Debentures or
any of the Preferred Securities.
SECTION 5.7 COVENANTS AS TO THE TRUST.
For so long as such Trust Securities of the Trust remain outstanding,
the Company shall (i) maintain 100% direct or indirect ownership of the Common
Securities of the Trust; provided, however, that any permitted successor of the
Company under this Indenture may succeed to the Company's ownership of the
Common Securities; (ii) not voluntarily terminate, wind up or
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liquidate the Trust, except upon prior regulatory approval if then so required
under applicable capital guidelines or regulatory policies and use its
reasonable efforts to cause the Trust (a) to remain a business trust, except in
connection with a distribution of Debentures, the redemption of all of the Trust
Securities of the Trust or certain mergers, consolidations or amalgamations,
each as permitted by the Trust Agreement; and (b) to otherwise continue not to
be treated as an association taxable as a corporation or partnership for United
States federal income tax purposes; and (iii) use its reasonable efforts to
cause each holder of Trust Securities to be treated as owning an individual
beneficial interest in the Debentures. In connection with the distribution of
the Debentures to the holders of the Preferred Securities issued by the Trust
upon a Dissolution Event, the Company shall use its best efforts to list such
Debentures on The Nasdaq Stock Market's National Market or on such other
exchange as the Preferred Securities are then listed.
SECTION 5.8 COVENANTS AS TO PURCHASES.
Prior to April ___, 2003, the Company shall not purchase any
Debentures, in whole or in part, from the Trust.
ARTICLE VI
DEBENTUREHOLDERS' LISTS AND REPORTS BY
THE COMPANY AND THE TRUSTEE
SECTION 6.1 COMPANY TO FURNISH TRUSTEE NAMES AND ADDRESSES OF
DEBENTURE HOLDERS
The Company shall furnish or cause to be furnished to the Trustee (a)
within one Business Day after January and June 30th of each year a list, in such
form as the Trustee may reasonably require, of the names and addresses of the
holders of the Debentures as of such regular record date, provided that the
Company shall not be obligated to furnish or cause to furnish such list at any
time that the list shall not differ in any respect from the most recent list
furnished to the Trustee by the Company; and (b) at such other times as the
Trustee may request in writing within 30 days after the receipt by the Company
of any such request, a list of similar form and content as of a date not more
than 15 days prior to the time such list is furnished; provided, however, that,
in either case, no such list need be furnished if the Trustee shall be the
Debenture Registrar.
SECTION 6.2 PRESERVATION OF INFORMATION COMMUNICATIONS WITH DEBENTUREHOLDERS
(a) The Trustee shall preserve, in as current a form as is reasonably
practicable, all information as to the names and addresses of the holders of
Debentures contained in the most recent list furnished to it as provided in
Section 6.1 and as to the names and addresses of holders of Debentures received
by the Trustee in its capacity as registrar for the Debentures (if acting in
such capacity).
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(b) The Trustee may destroy any list furnished to it as provided in
Section 6.1 upon receipt of a new list so furnished.
(c) Debentureholders may communicate as provided in Section 312(b) of
the Trust Indenture Act with other Debentureholders with respect to their rights
under this Indenture or under the Debentures.
SECTION 6.3 REPORTS BY THE COMPANY.
(a) The Company covenants and agrees to file with the Trustee, within
15 days after the Company is required to file the same with the Commission,
copies of the annual reports and of the information, documents and other reports
(or copies of such portions of any of the foregoing as the Commission may from
time to time by rules and regulations prescribe) that the Company may be
required to file with the Commission pursuant to Section 13 or Section 15(d) of
the Exchange Act; or, if the Company is not required to file information,
documents or reports pursuant to either of such Sections, then to file with the
Trustee and the Commission, in accordance with the rules and regulations
prescribed from time to time by the Commission, such of the supplementary and
periodic information, documents and reports that may be required pursuant to
Section 13 of the Exchange Act in respect of a security listed and registered on
a national securities exchange as may be prescribed from time to time in such
rules and regulations.
(b) The Company covenants and agrees to file with the Trustee and the
Commission, in accordance with the rules and regulations prescribed from to time
by the Commission, such additional information, documents and reports with
respect to compliance by the Company with the conditions and covenants provided
for in this Indenture as may be required from time to time by such rules and
regulations.
(c) The Company covenants and agrees to transmit by mail, first class
postage prepaid, or reputable over-night delivery service that provides for
evidence of receipt, to the Debentureholders, as their names and addresses
appear upon the Debenture Register, within 30 days after the filing thereof with
the Trustee, such summaries of any information, documents and reports required
to be filed by the Company pursuant to subsections (a) and (b) of this Section
6.3 and delivered to Debenture holders or the Company's stockholders as may be
required by rules and regulations prescribed from time to time by the
Commission.
(d) Delivery of such reports, information and documents to the Trustee
is for informational purposes only and the Trustee's receipt of such shall not
constitute constructive notice of any information contained therein or
determinable from information contained therein, including the Company's
compliance with any of its covenants hereunder (as to which the Trustee is
entitled to rely exclusively on Officers' Certificates).
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SECTION 6.4 REPORTS BY THE TRUSTEE.
(a) The Trustee shall transmit to Debentureholders such reports
concerning the Trustee and its actions under this Indenture as may be required
pursuant to the Trust Indenture Act at the times and in the manner provided
pursuant thereto. If required by Section 313(a) of the Trust Indenture Act, the
Trustee shall, within sixty days after each May 15 following the date of this
Indenture deliver to Debentureholders a brief report, dated as of such May 15,
which complies with the provisions of such Section 313(a).
(b) A copy of each such report shall, at the time of such transmission
to Debentureholders, be filed by the Trustee with each stock exchange, if any,
upon which the Debentures are listed with the Commission and with the Company
will promptly notify the Trustee when any Debentures become listed on any stock
exchange.
SECTION 6.5 STATEMENTS AS TO DEFAULT.
(a) The Company will deliver to the Trustee annually, within 120 days
after the end of each of its fiscal years, a certificate, from its principal
executive officer, principal financial officer or principal accounting officer,
stating whether or not to the best knowledge of the signer thereof the Company
is in compliance (without regard to periods of grace or notice requirements)
with all conditions and covenants under this Indenture, and if the Company shall
not be in compliance, specifying such non-compliance and the nature and status
thereof of which such signer may have knowledge.
(b) The Company shall deliver to the Trustee, as soon as possible and
in any event within five days after the Company becomes aware of the occurrence
of any Event of Default or an event which, with notice or the lapse of time or
both, would constitute an Event of Default, an Officers' Certificate setting
forth the details of such Event of Default or Default and the action which the
Company proposes to take with respect thereto.
ARTICLE VII
REMEDIES OF THE TRUSTEE AND DEBENTUREHOLDERS
ON EVENT OF DEFAULT
SECTION 7.1 EVENTS OF DEFAULT.
(a) Whenever used herein with respect to the Debentures, "Event of
Default" means any one or more of the following events that has occurred and is
continuing:
(i) the Company defaults in the payment of any installment of
interest (including Additional Interest or Compounded
Interest, if any) upon any of the Debentures, as and when the
same shall become due and payable, and continuance of such
default for a period of 30 days; provided, however, that a
valid extension
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of an interest payment period by the Company in accordance
with the terms of this Indenture shall not constitute a
default in the payment of interest for this purpose;
(ii) the Company defaults in the payment of the principal on
the Debentures as and when the same shall become due and
payable whether at maturity, upon redemption, by declaration
of acceleration of maturity or otherwise;
(iii) the Company fails to observe or perform any other of its
covenants or agreements with respect to the Debentures for a
period of 90 days after the date on which written notice of
such failure, requiring the same to be remedied and stating
that such notice is a "Notice of Default" hereunder, shall
have been given to the Company by the Trustee, by registered
or certified mail, or to the Company and the Trustee by the
holders of at least 25% in aggregate principal amount of the
Debentures at the time Outstanding;
(iv) the Company pursuant to or within the meaning of any
Bankruptcy Law (i) commences a voluntary case; (ii) consents
to the entry of an order for relief against it in an
involuntary case; (iii) consents to the appointment of a
Custodian of it or for all or substantially all of its
property; or (iv) makes a general assignment for the benefit
of its creditors;
(v) a court of competent jurisdiction enters an order under
any Bankruptcy Law that (i) is for relief against the Company
in an involuntary case; (ii) appoints a Custodian of the
Company for all or substantially all of its property; or (iii)
orders the liquidation of the Company, and the order or decree
remains unstayed and in effect for 60 days; or
(vi) the Trust shall have voluntarily or involuntarily
dissolved, wound-up its business or otherwise terminated its
existence except in connection with (i) the distribution of
Debentures to holders of Trust Securities in liquidation of
their interests in the Trust; (ii) the redemption of all of
the outstanding Trust Securities of the Trust; or (iii)
certain mergers, consolidations or amalgamations, each as
permitted by the Trust Agreement.
(b) In each and every such case, unless the principal of all the
Debentures shall have already become due and payable, either the Trustee or the
holders of not less than 25% in aggregate principal amount of the Debentures
then Outstanding hereunder, by notice in writing to the Company (and to the
Trustee if given by such Debentureholders) may declare the principal of all the
Debentures to be due and payable immediately, and upon any such declaration the
same shall become and shall be immediately due and payable, notwithstanding
anything contained in this Indenture or in the Debentures.
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(c) At any time after the principal of the Debentures shall have been
so declared due and payable, and before any judgment or decree for the payment
of the moneys due shall have been obtained or entered as hereinafter provided,
the holders of a majority in aggregate principal amount of the Debentures then
Outstanding hereunder, by written notice to the Company and the Trustee, may
rescind and annul such declaration and its consequences if: (i) the Company has
paid or deposited with the Trustee a sum sufficient to pay all matured
installments of interest (including Additional Interest and Compounded Interest,
if any) upon all the Debentures and the principal of any and all Debentures that
shall have become due otherwise than by acceleration (with interest upon such
principal, and upon overdue installments of interest, at the rate per annum
expressed in the Debentures to the date of such payment or deposit) and the
amount payable to the Trustee under Section 9.6; and (ii) any and all Events of
Default under this Indenture, other than the nonpayment of principal on
Debentures that shall not have become due by their terms, shall have been
remedied or waived as provided in Section 7.6. No such rescission and annulment
shall extend to or shall affect any subsequent default or impair any right
consequent thereon.
(d) In case the Trustee shall have proceeded to enforce any right with
respect to Debentures under this Indenture and such proceedings shall have been
discontinued or abandoned because of such rescission or annulment or for any
other reason or shall have been determined adversely to the Trustee, then and in
every such case the Company and the Trustee shall be restored respectively to
their former positions and rights hereunder, and all rights, remedies and powers
of the Company and the Trustee shall continue as though no such proceedings had
been taken.
SECTION 7.2 COLLECTION OF INDEBTEDNESS AND SUITS FOR ENFORCEMENT BY TRUSTEE.
(a) The Company covenants that (1) in case it shall default in the
payment of any installment of interest (including Additional Interest and
Compounded Interest) on any of the Debentures, and such default shall have
continued for a period of 90 Business Days; or (2) in case it shall default in
the payment of the principal of any of the Debentures when the same shall have
become due and payable, whether upon maturity of the Debentures or upon
redemption or upon declaration or otherwise, then, upon demand of the Trustee,
the Company shall pay to the Trustee, for the benefit of the holders of the
Debentures, the whole amount that then shall have been become due and payable on
all such Debentures for principal or interest, or both, as the case may be, with
interest upon the overdue principal and (if the Debentures are held by the Trust
or a trustee of the Trust, without duplication of any other amounts paid by the
Trust or trustee in respect thereof) upon overdue installments of interest at
the rate per annum expressed in the Debentures; and, in addition thereto, such
further amount as shall be sufficient to cover the costs and expenses of
collection, and the amount payable to the Trustee and its counsel under Section
9.7.
(b) If the Company shall fail to pay such amounts forthwith upon such
demand, the Trustee, in its own name and as trustee of an express trust, shall
be entitled and empowered to institute any action or proceedings at law or in
equity for the collection of the sums so due and
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unpaid, and may prosecute any such action or proceeding to judgment or final
decree, and may enforce any such judgment or final decree against the Company or
other obligor upon the Debentures and collect the moneys adjudged or decreed to
be payable in the manner provided by law out of the property of the Company or
other obligor upon the Debentures, wherever situated.
(c) In case of any receivership, insolvency, liquidation, bankruptcy,
reorganization, readjustment, arrangement, composition or judicial proceedings
affecting the Company or the creditors or property of either, the Trustee shall
have power to intervene in such proceedings and take any action therein that may
be permitted by the court and shall (except as may be otherwise provided by law)
be entitled to file such proofs of claim and other papers and documents as may
be necessary or advisable in order to have the claims of the Trustee and of the
holders of the Debentures allowed for the entire amount due and payable by the
Company under this Indenture at the date of institution of such proceedings and
for any additional amount that may become due and payable by the Company after
such date, and to collect and receive any moneys or other property payable or
deliverable on any such claim, and to distribute the same after the deduction of
the amount payable to the Trustee and its counsel under Section 9.7; and any
receiver, assignee or trustee in bankruptcy or reorganization is hereby
authorized by each of the holders of the Debentures to make such payments to the
Trustee, and, in the event that the Trustee shall consent to the making of such
payments directly to such Debentureholders, to pay to the Trustee any amount due
it under Section 9.7.
(d) All rights of action and of asserting claims under this Indenture,
or under any of the terms established with respect to Debentures, may be
enforced by the Trustee without the possession of any of such Debentures, or the
production thereof at any trial or other proceeding relating thereto, and any
such suit or proceeding instituted by the Trustee shall be brought in its own
name as trustee of an express trust, and any recovery of judgment shall, after
provision for payment to the Trustee of any amounts due under Section 9.7, be
for the ratable benefit of the holders of the Debentures. In case of an Event of
Default hereunder, the Trustee may in its discretion proceed to protect and
enforce the rights vested in it by this Indenture by such appropriate judicial
proceedings as the Trustee shall deem most effectual to protect and enforce any
of such rights, either at law or in equity or in bankruptcy or otherwise,
whether for the specific enforcement of any covenant or agreement contained in
this Indenture or in aid of the exercise of any power granted in this Indenture,
or to enforce any other legal or equitable right vested in the Trustee by this
Indenture or by law. Nothing contained herein shall be deemed to authorize the
Trustee to authorize or consent to or accept or adopt on behalf of any
Debentureholder any plan of reorganization, arrangement, adjustment or
composition affecting the Debentures or the rights of any holder thereof or to
authorize the Trustee to vote in respect of the claim of any Debentureholder in
any such proceeding.
SECTION 7.3 APPLICATION OF MONEYS COLLECTED.
Any moneys collected by the Trustee pursuant to this Article VII with
respect to the Debentures shall be applied in the following order, at the date
or dates fixed by the Trustee and,
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in case of the distribution of such moneys on account of principal or interest,
upon presentation of the Debentures, and notation thereon the payment, if only
partially paid, and upon surrender thereof if fully paid:
FIRST: To the payment of costs and expenses of collection and
of all amounts payable to the Trustee under Section 9.7;
SECOND: To the payment of all Senior Indebtedness of the
Company if and to the extent required by Article XVI; and
THIRD: To the payment of the amounts then due and unpaid upon
the Debentures for principal and interest, in respect of which
or for the benefit of which such money has been collected,
ratably, without preference or priority of any kind, according
to the amounts due and payable on such Debentures for
principal and interest, respectively.
FOURTH: Any remaining balance to the Company.
SECTION 7.4 LIMITATION ON SUITS.
(a) No holder of any Debenture shall have any right by virtue or by
availing of any provision of this Indenture to institute any suit, action or
proceeding in equity or at law upon or under or with respect to this Indenture
or for the appointment of a receiver or trustee, or for any other remedy
hereunder, unless (i) such holder previously shall have given to the Trustee
written notice of an Event of Default and of the continuance thereof with
respect to the Debentures specifying such Event of Default, as hereinbefore
provided; (ii) the holders of not less than 25% in aggregate principal amount of
the Debentures then Outstanding shall have made written request upon the Trustee
to institute such action, suit or proceeding in its own name as trustee
hereunder; (iii) such holder or holders shall have offered to the Trustee such
reasonable indemnity as it may require against the costs, expenses and
liabilities to be incurred therein or thereby; and (iv) the Trustee for 60 days
after its receipt of such notice, request and offer of indemnity, shall have
failed to institute any such action, suit or proceeding; and (v) during such 60
day period, the holders of a majority in principal amount of the Debentures do
not give the Trustee a direction inconsistent with the request.
(b) Notwithstanding anything contained herein to the contrary or any
other provisions of this Indenture, the right of any holder of the Debentures to
receive payment of the principal of and interest on the Debentures, as therein
provided, on or after the respective due dates expressed in such Debenture (or
in the case of redemption, on the redemption date), or to institute suit for the
enforcement of any such payment on or after such respective dates or redemption
date, shall not be impaired or affected without the consent of such holder and
by accepting a Debenture hereunder it is expressly understood, intended and
covenanted by the taker and holder of every Debenture with every other such
taker and holder and the Trustee, that no one or more holders of Debentures
shall have any right in any manner whatsoever by virtue or by availing of
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any provision of this Indenture to affect, disturb or prejudice the rights of
the holders of any other of such Debentures, or to obtain or seek to obtain
priority over or preference to any other such holder, or to enforce any right
under this Indenture, except in the manner herein provided and for the equal,
ratable and common benefit of all holders of Debentures. For the protection and
enforcement of the provisions of this Section 7.4, each and every
Debentureholder and the Trustee shall be entitled to such relief as can be given
either at law or in equity.
SECTION 7.5 RIGHTS AND REMEDIES CUMULATIVE; DELAY OR OMISSION NOT WAIVER.
(a) Except as otherwise provided in Section 2.8, all powers and
remedies given by this Article VII to the Trustee or to the Debentureholders
shall, to the extent permitted by law, be deemed cumulative and not exclusive of
any other powers and remedies available to the Trustee or the holders of the
Debentures, by judicial proceedings or otherwise, to enforce the performance or
observance of the covenants and agreements contained in this Indenture or
otherwise established with respect to such Debentures.
(b) No delay or omission of the Trustee or of any holder of any of the
Debentures to exercise any right or power accruing upon any Event of Default
occurring and continuing as aforesaid shall impair any such right or power, or
shall be construed to be a waiver of any such default or an acquiescence
therein; and, subject to the provisions of Section 7.4, every power and remedy
given by this Article VII or by law to the Trustee or the Debentureholders may
be exercised from time to time, and as often as shall be deemed expedient, by
the Trustee or by the Debentureholders.
SECTION 7.6 CONTROL BY DEBENTUREHOLDERS.
The holders of a majority in aggregate principal amount of the
Debentures at the time Outstanding, determined in accordance with Section 10.4,
shall have the right to direct the time, method and place of conducting any
proceeding for any remedy available to the Trustee, or exercising any trust or
power conferred on the Trustee; provided, however, that such direction shall not
be in conflict with any rule of law or with this Indenture. Subject to the
provisions of Section 9.1, the Trustee shall have the right to decline to follow
any such direction if the Trustee in good faith shall, by a Responsible Officer
or Officers of the Trustee, determine that the proceeding so directed would
involve the Trustee in personal liability. The holders of a majority in
aggregate principal amount of the Debentures at the time Outstanding affected
thereby, determined in accordance with Section 10.4, may on behalf of the
holders of all of the Debentures waive any past default in the performance of
any of the covenants contained herein and its consequences, except (i) a default
in the payment of the principal of or interest on, any of the Debentures as and
when the same shall become due by the terms of such Debentures otherwise than by
acceleration (unless such default has been cured and a sum sufficient to pay all
matured installments of interest and principal has been deposited with the
Trustee (in accordance with Section 7.1(c)); (ii) a default in the covenants
contained in Section 5.6; or (iii) in respect of a covenant or provision hereof
which cannot be modified or amended without the consent of the holder of each
Outstanding Debenture affected; provided, however, that if the Debentures are
held by the Trust or a trustee of the Trust, such waiver or modification to such
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waiver shall not be effective until the holders of a majority in liquidation
preference of Trust Securities of the Trust shall have consented to such waiver
or modification to such waiver; provided further, that if the consent of the
holder of each Outstanding Debenture is required, such waiver shall not be
effective until each holder of the Trust Securities of the Trust shall have
consented to such waiver. Upon any such waiver, the default covered thereby
shall be deemed to be cured for all purposes of this Indenture and the Company,
the Trustee and the holders of the Debentures shall be restored to their former
positions and rights hereunder, respectively; but no such waiver shall extend to
any subsequent or other default or impair any right consequent thereon.
SECTION 7.7 UNDERTAKING TO PAY COSTS.
All parties to this Indenture agree, and each holder of any Debentures
by such holder's acceptance thereof shall be deemed to have agreed, that any
court may in its discretion require, in any suit for the enforcement of any
right or remedy under this Indenture, or in any suit against the Trustee for any
action taken or omitted by it as Trustee, the filing by any party litigant in
such suit of an undertaking to pay the costs of such suit, and that such court
may in its discretion assess reasonable costs, including reasonable attorneys'
fees and expenses, against any party litigant in such suit, having due regard to
the merits and good faith of the claims or defenses made by such party litigant;
but the provisions of this Section 7.7 shall not apply to any suit instituted by
the Trustee, to any suit instituted by any Debentureholder, or group of
Debentureholders holding more than 10% in aggregate principal amount of the
Outstanding Debentures, or to any suit instituted by any Debentureholder for the
enforcement of the payment of the principal of or interest on the Debentures, on
or after the respective due dates expressed in such Debenture or established
pursuant to this Indenture.
SECTION 7.8 DIRECT ACTION BY HOLDERS OF PREFERRED SECURITIES.
Any registered holder of the Preferred Securities issued by the Trust
shall have the right, upon the occurrence of an Event of Default described in
Section 7.1(a)(i) or 7.1(a)(ii), to institute a suit directly against the
Company for enforcement of payment to such holder of principal of and (subject
to Sections 2.4 and 4.1) interest (including any Additional Interest) on the
Debentures having a principal amount equal to the aggregate Liquidation Amount
(as defined in the Trust Agreement) of such Preferred Securities held by such
holder. The Company may not amend this Indenture to remove this right to
institute a suit directly against the Company without the prior consent of the
holders of all the Preferred Securities.
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ARTICLE VIII
FORM OF DEBENTURE AND ORIGINAL ISSUE
SECTION 8.1 FORM OF DEBENTURE.
The Debenture and the Trustee's Certificate of Authentication to be
endorsed thereon are to be substantially in the forms contained as Exhibit A
attached hereto and incorporated herein by reference.
SECTION 8.2 ORIGINAL ISSUE OF DEBENTURES.
Debentures in the aggregate principal amount of up to $__________ may,
upon execution of this Indenture, be executed by the Company and delivered to
the Trustee for authentication, and the Trustee shall thereupon authenticate and
make available for delivery said Debentures to or upon the written order of the
Company, signed by its Chairman, its Vice Chairman, its President, or any Vice
President and its Treasurer or an Assistant Treasurer, without any further
action by the Company.
ARTICLE IX
CONCERNING THE TRUSTEE
SECTION 9.1 CERTAIN DUTIES AND RESPONSIBILITIES.
(a) The Trustee, prior to the occurrence of an Event of Default and
after the curing of all Events of Default that may have occurred, shall
undertake to perform with respect to the Debentures such duties and only such
duties as are specifically set forth in this Indenture, and no implied covenants
shall be read into this Indenture against the Trustee. In case an Event of
Default has occurred that has not been cured or waived, the Trustee shall
exercise such of the rights and powers vested in it by this Indenture, and use
the same degree of care and skill in their exercise, as a prudent man would
exercise or use under the circumstances in the conduct of his own affairs.
(b) No provision of this Indenture shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent failure
to act, or its own willful misconduct, except that:
(1) prior to the occurrence of an Event of Default and after the curing
or waiving of all Events of Default that may have occurred:
(i) the duties and obligations of the Trustee shall, with
respect to the Debentures, be determined solely by the express
provisions of this Indenture, and the Trustee shall not be
liable with respect to the Debentures except for the
performance of such duties and obligations as are specifically
set forth in this
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Indenture, and no implied covenants or obligations shall be
read into this Indenture against the Trustee; and
(ii) in the absence of bad faith on the part of the Trustee,
the Trustee may with respect to the Debentures conclusively
rely, as to the truth of the statements and the correctness of
the opinions expressed therein, upon any certificates or
opinions furnished to the Trustee and conforming to the
requirements of this Indenture; but in the case of any such
certificates or opinions that by any provision hereof are
specifically required to be furnished to the Trustee, the
Trustee shall be under a duty to examine the same to determine
whether or not they conform to the requirements of this
Indenture;
(2) the Trustee shall not be liable for any error of judgment made in
good faith by a Responsible Officer or Responsible Officers of the
Trustee, unless it shall be proved that the Trustee was negligent in
ascertaining the pertinent facts;
(3) the Trustee shall not be liable with respect to any action taken or
omitted to be taken by it in good faith in accordance with the
direction of the holders of not less than a majority in principal
amount of the Debentures at the time outstanding relating to the time,
method and place of conducting any proceeding for any remedy available
to the Trustee, or exercising any trust or power conferred upon the
Trustee under this Indenture with respect to the Debentures; and
(4) none of the provisions contained in this Indenture shall require
the Trustee to expend or risk its own funds or otherwise incur personal
financial liability in the performance of any of its duties or in the
exercise of any of its rights or powers, if there is reasonable ground
for believing that the repayment of such funds or liability is not
reasonably assured to it under the terms of this Indenture or adequate
indemnity against such risk is not reasonably assured to it.
SECTION 9.2 NOTICE OF DEFAULTS.
Within 90 days after actual knowledge by a Responsible Officer of the
Trustee of the occurrence of any default hereunder with respect to the
Debentures, the Trustee shall transmit by mail to all holders of the Debentures,
as their names and addresses appear in the Debenture Register, notice of such
default, unless such default shall have been cured or waived; provided, however,
that, except in the case of any default in the payment of the principal or
interest (including Additional Interest and Compounded Interest, if any) on any
Debenture, the Trustee shall be protected in withholding such notice if and so
long as the board of directors, the executive committee or a trust committee of
the directors and/or Responsible Officers of the Trustee determines in good
faith that the withholding of such notice is in the interests of the holders of
such Debentures; and provided, further, that in the case of any default of the
character specified in Section 7.1(a)(iii), no such notice to holders of
Debentures need be sent until at least 30 days after the occurrence thereof. For
the purposes of this Section 9.2, the term "default"
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means any event which is, or after notice or lapse of time or both, would
become, an Event of Default with respect to the Debentures.
SECTION 9.3 CERTAIN RIGHTS OF TRUSTEE.
Except as otherwise provided in Section 9.1:
(a) The Trustee may conclusively rely and shall be protected in acting
or refraining from acting upon any resolution, certificate, statement,
instrument, opinion, report, notice, request, consent, order, approval, bond,
security or other paper or document believed by it to be genuine and to have
been signed or presented by the proper party or parties;
(b) Any request, direction, order or demand of the Company mentioned
herein shall be sufficiently evidenced by a Board Resolution or an instrument
signed in the name of the Company by the President or any Vice President and by
the Secretary or an Assistant Secretary or the Treasurer or an Assistant
Treasurer thereof (unless other evidence in respect thereof is specifically
prescribed herein);
(c) The Trustee shall not be deemed to have knowledge of a default or
an Event of Default, other than an Event of Default specified in Section
7.1(a)(i) or (ii), unless and until it receives notification of such Event of
Default from the Company or by holders of at least 25% of the aggregate
principal amount of the Debentures at the time Outstanding;
(d) The Trustee may consult with counsel of its selection and the
advice of such counsel or any Opinion of Counsel shall be full and complete
authorization and protection in respect of any action taken or suffered or
omitted hereunder in good faith and in reliance thereon;
(e) The Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request, order or
direction of any of the Debentureholders, pursuant to the provisions of this
Indenture, unless such Debentureholders shall have offered to the Trustee
reasonable security or indemnity against the costs, expenses and liabilities
that may be incurred therein or thereby; nothing contained herein shall,
however, relieve the Trustee of the obligation, upon the occurrence of an Event
of Default (that has not been cured or waived) to exercise with respect to the
Debentures such of the rights and powers vested in it by this Indenture, and to
use the same degree of care and skill in their exercise, as a prudent man would
exercise or use under the circumstances in the conduct of his own affairs;
(f) The Trustee shall not be liable for any action taken or omitted to
be taken by it in good faith and believed by it to be authorized or within the
discretion or rights or powers conferred upon it by this Indenture;
(g) The Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, consent, order, approval, bond, security, or
other papers or documents, but the Trustee in its discretion may make such
inquiry or investigation into such facts or matters as it may see fit, and, if
the
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Trustee shall determine to make such inquiry or investigation, it shall be
entitled to examine the books, records and premises of the Company, personally
or by agent or attorney; and
(h) The Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents or
attorneys and the Trustee shall not be responsible for any misconduct or
negligence on the part of any agent or attorney appointed with due care by it
hereunder.
SECTION 9.4 TRUSTEE NOT RESPONSIBLE FOR RECITALS, ETC.
(a) The Recitals contained herein and in the Debentures, except the
certificates of authentication, shall be taken as the statements of the Company,
and the Trustee assumes no responsibility for the correctness of the same.
(b) The Trustee makes no representations as to the validity or
sufficiency of this Indenture or of the Debentures.
(c) The Trustee shall not be accountable for the use or application by
the Company of any of the Debentures or of the proceeds of such Debentures, or
for the use or application of any moneys paid over by the Trustee in accordance
with any provision of this Indenture, or for the use or application of any
moneys received by any paying agent other than the Trustee.
SECTION 9.5 MAY HOLD DEBENTURES.
The Trustee or any paying agent or registrar for the Debentures, in its
individual or any other capacity, may become the owner or pledgee of Debentures
and, subject to Sections 9.9 and 9.14, may otherwise deal with the Company with
the same rights it would have if it were not Trustee, paying agent or Debenture
Registrar.
SECTION 9.6 MONEYS HELD IN TRUST.
Subject to the provisions of Section 13.5, all moneys received by the
Trustee shall, until used or applied as herein provided, be held in trust for
the purposes for which they were received, but need not be segregated from other
funds except to the extent required by law. The Trustee shall be under no
liability for interest on any moneys received by it hereunder except such as it
may agree in writing with the Company to pay thereon.
SECTION 9.7 COMPENSATION AND REIMBURSEMENT.
The Company agrees:
(1) to pay to the Trustee from time to time such compensation as the
Company and the Trustee shall from time to time agree in writing for all
services rendered by it hereunder (which compensation shall not be limited by
any provision of law in regard to the compensation of a trustee of an express
trust);
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(2) except as otherwise expressly provided herein, to reimburse the
Trustee upon its request for all reasonable expenses, disbursements and advances
incurred or made by the Trustee in accordance with any provision of this
Indenture (including the compensation and the expenses and disbursements of its
agents and counsel), except any such expense, disbursement or advance as may be
attributable to its negligence or bad faith; and
(3) to indemnify each of the Trustee or any predecessor Trustee and
their agents for, and to hold them harmless against, any and all loss, damage,
claims, liability or expense, including taxes (other than taxes based upon,
measured by or determined by the income of the Trustee), arising out of or in
connection with the acceptance or administration of the trust or trusts
hereunder, including the costs and expenses of defending itself against any
claim or liability in connection with the exercise or performance of any of its
powers or duties hereunder, except to the extent that such loss, damage, claim,
liability or expense is due to its own negligence or bad faith.
The Trustee shall have a lien prior to the Debentures as to all
property and funds held by it hereunder for any amount owing it or any
predecessor Trustee pursuant to this Section 9.7, except with respect to funds
held in trust for the benefit of the holders of particular Debentures. When the
Trustee incurs expenses or renders services in connection with an Event of
Default specified in Section 7.1(a)(iv), Section 7.1(a)(v) or 7.1(a)(vi), the
expenses (including the reasonable charges and expenses of its counsel) and the
compensation for the services are intended to constitute expenses of
administration under any applicable Bankruptcy Law.
The provisions of this Section shall survive the termination of this
Indenture.
SECTION 9.8 RELIANCE ON OFFICERS' CERTIFICATE.
Except as otherwise provided in Section 9.1, whenever in the
administration of the provisions of this Indenture the Trustee shall deem it
necessary or desirable that a matter be proved or established prior to taking or
suffering or omitting to take any action hereunder, such matter (unless other
evidence in respect thereof be herein specifically prescribed) may, in the
absence of negligence or bad faith on the part of the Trustee, be deemed to be
conclusively proved and established by an Officers' Certificate delivered to the
Trustee and such certificate, in the absence of negligence or bad faith on the
part of the Trustee, shall be full warrant to the Trustee for any action taken,
suffered or omitted to be taken by it under the provisions of this Indenture
upon the faith thereof.
SECTION 9.9 DISQUALIFICATION: CONFLICTING INTERESTS.
If the Trustee has or shall acquire any "conflicting interest" within
the meaning of Section 310(b) of the Trust Indenture Act, the Trustee and the
Company shall in all respects comply with the provisions of Section 310(b) of
the Trust Indenture Act.
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SECTION 9.10 CORPORATE TRUSTEE REQUIRED ELIGIBILITY.
There shall at all times be a Trustee with respect to the Debentures
issued hereunder which shall at all times be a corporation organized and doing
business under the laws of the United States of America or any State or
Territory thereof or of the District of Columbia or a corporation or other
Person permitted to act as trustee by the Commission, authorized under such laws
to exercise corporate trust powers, having a combined capital and surplus of at
least $50,000,000, and subject to supervision or examination by federal, state,
territorial, or District of Columbia authority. If such corporation publishes
reports of condition at least annually, pursuant to law or to the requirements
of the aforesaid supervising or examining authority, then for the purposes of
this Section 9.10, the combined capital and surplus of such corporation shall be
deemed to be its combined capital and surplus as set forth in its most recent
report of condition so published. The Company may not, nor may any Person
directly or indirectly controlling, controlled by, or under common control with
the Company, serve as Trustee. In case at any time the Trustee shall cease to be
eligible in accordance with the provisions of this Section 9.10, the Trustee
shall resign immediately in the manner and with the effect specified in Section
9.11.
SECTION 9.11 RESIGNATION AND REMOVAL; APPOINTMENT OF SUCCESSOR.
(a) The Trustee or any successor hereafter appointed, may at any time
resign by giving written notice thereof to the Company and by transmitting
notice of resignation by mail, first class postage prepaid, to the
Debentureholders, as their names and addresses appear upon the Debenture
Register. Upon receiving such notice of resignation, the Company shall promptly
appoint a successor trustee with respect to Debentures by written instrument, in
duplicate, executed by order of the Board of Directors, one copy of which
instrument shall be delivered to the resigning Trustee and one copy to the
successor trustee. If no successor trustee shall have been so appointed and have
accepted appointment within 30 days after the mailing of such notice of
resignation, the resigning Trustee may petition at the expense of the Company
any court of competent jurisdiction for the appointment of a successor trustee
with respect to Debentures, or any Debentureholder who has been a bona fide
holder of a Debenture or Debentures for at least six months may, subject to the
provisions of Section 9.9, on behalf of himself and all others similarly
situated, petition any such court for the appointment of a successor trustee.
Such court may thereupon after such notice, if any, as it may deem proper,
appoint a successor trustee.
(b) In case at any time any one of the following shall occur
(i) the Trustee shall fail to comply with the provisions of
Section 9.9 after written request therefor by the Company or
by any Debentureholder who has been a bona fide holder of a
Debenture or Debentures for at least six months; or
(ii) the Trustee shall cease to be eligible in accordance with
the provisions of Section 9.10 and shall fail to resign after
written request therefor by the Company or by any such
Debentureholder; or
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(iii) the Trustee shall become incapable of acting, or shall
be adjudged bankrupt or insolvent, or commence a voluntary
bankruptcy proceeding, or a receiver of the Trustee or of its
property shall be appointed or consented to, or any public
officer shall take charge or control of the Trustee or of its
property or affairs for the purpose of rehabilitation,
conservation or liquidation, then, in any such case, the
Company may remove the Trustee with respect to all Debentures
and appoint a successor trustee by written instrument, in
duplicate, executed by order of the Board of Directors, one
copy of which instrument shall be delivered to the Trustee so
removed and one copy to the successor trustee, or, subject to
the provisions of Section 9.9, unless the Trustee's duty to
resign is stayed as provided herein, any Debentureholder who
has been a bona fide holder of a Debenture or Debentures for
at least six months may, on behalf of that holder and all
others similarly situated, petition any court of competent
jurisdiction for the removal of the Trustee and the
appointment of a successor trustee. Such court may thereupon
after such notice, if any, as it may deem proper and
prescribe, remove the Trustee and appoint a successor trustee.
(c) The holders of a majority in aggregate principal amount of the
Debentures at the time Outstanding may at any time remove the Trustee by so
notifying the Trustee and the Company and may appoint a successor Trustee with
the consent of the Company. If no successor trustee shall have been so appointed
and have accepted appointment within 30 days after such notification, the
Trustee may petition at the expense of the Company any court of competent
jurisdiction for the appointment of a successor trustee with respect to
Debentures, or any Debentureholder who has been a bona fide holder of a
Debenture or Debentures for at least six months may, subject to the provisions
of Section 9.9, on behalf of himself and all others similarly situated, petition
any such court for the appointment of a successor trustee. Such court may
appoint a successor trustee.
(d) No resignation or removal of the Trustee and no appointment of a
successor trustee with respect to the Debentures pursuant to any of the
provisions of this Section 9.11 shall become effective until acceptance of
appointment by the successor trustee as provided in Section 9.12.
SECTION 9.12 ACCEPTANCE OF APPOINTMENT BY SUCCESSOR.
(a) In case of the appointment hereunder of a successor trustee with
respect to the Debentures, every successor trustee so appointed shall execute,
acknowledge and deliver to the Company and to the retiring Trustee an instrument
accepting such appointment, and thereupon the resignation or removal of the
retiring Trustee shall become effective and such successor trustee, without any
further act, deed or conveyance, shall become vested with all the rights,
powers, trusts and duties of the retiring Trustee; but, on the request of the
Company or the successor trustee, such retiring Trustee shall, upon payment of
its charges, execute and deliver an instrument transferring to such successor
trustee all the rights, powers, and trusts of the retiring Trustee and shall
duly assign, transfer and deliver to such successor trustee all property and
money held by such retiring Trustee hereunder.
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(b) Upon request of any successor trustee, the Company shall execute
any and all instruments for more fully and certainly vesting in and confirming
to such successor trustee all such rights, powers and trusts referred to in
paragraph (a) of this Section 9.12.
(c) No successor trustee shall accept its appointment unless at the
time of such acceptance such successor trustee shall be qualified and eligible
under this Article IX.
(d) Upon acceptance of appointment by a successor trustee as provided
in this Section 9.12, the Company shall transmit notice of the succession of
such trustee hereunder by mail, first class postage prepaid, to the
Debentureholders, as their names and addresses appear upon the Debenture
Register. If the Company fails to transmit such notice within ten days after
acceptance of appointment by the successor trustee, the successor trustee shall
cause such notice to be transmitted at the expense of the Company.
SECTION 9.13 MERGER, CONVERSION, CONSOLIDATION OR SUCCESSION TO BUSINESS.
Any corporation into which the Trustee may be merged or converted or
with which it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any
corporation succeeding to all or substantially all the corporate trust business
of the Trustee, shall be the successor of the Trustee hereunder, provided that
such corporation shall be qualified under the provisions of Section 9.9 and
eligible under the provisions of Section 9.10, without the execution or filing
of any paper or any further act on the part of any of the parties hereto,
anything herein to the contrary notwithstanding. In case any Debentures shall
have been authenticated, but not delivered, by the Trustee then in office, any
successor by merger, conversion or consolidation to such authenticating Trustee
may adopt such authentication and deliver the Debentures so authenticated with
the same effect as if such successor Trustee had itself authenticated such
Debentures.
SECTION 9.14 PREFERENTIAL COLLECTION OF CLAIMS AGAINST THE COMPANY.
The Trustee shall comply with Section 31l(a) of the Trust Indenture
Act, excluding any creditor relationship described in Section 311(b) of the
Trust Indenture Act. A Trustee who has resigned or been removed shall be subject
to Section 311(a) of the Trust Indenture Act to the extent included therein.
ARTICLE X
CONCERNING THE DEBENTUREHOLDERS
SECTION 10.1 EVIDENCE OF ACTION BY HOLDERS.
(a) Whenever in this Indenture it is provided that the holders of a
majority or specified percentage in aggregate principal amount of the Debentures
may take any action (including the making of any demand or request, the giving
of any notice, consent or waiver or the taking of any other action), the fact
that at the time of taking any such action the holders of such majority
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or specified percentage have joined therein may be evidenced by any instrument
or any number of instruments of similar tenor executed by such holders of
Debentures in Person or by agent or proxy appointed in writing.
(b) If the Company shall solicit from the Debentureholders any request,
demand, authorization, direction, notice, consent, waiver or other action, the
Company may, at its option, as evidenced by an Officers' Certificate, fix in
advance a record date for the determination of Debentureholders entitled to give
such request, demand, authorization, direction, notice, consent, waiver or other
action, but the Company shall have no obligation to do so. If such a record date
is fixed, such request, demand, authorization, direction, notice, consent,
waiver or other action may be given before or after the record date, but only
the Debentureholders of record at the close of business on the record date shall
be computed to be Debentureholders for the purposes of determining whether
Debentureholders of the requisite proportion of Outstanding Debentures have
authorized or agreed or consented to such request, demand, authorization,
direction, notice, consent, waiver or other action, and for that purpose the
Outstanding Debentures shall be computed as of the record date; provided,
however, that no such authorization, agreement or consent by such
Debentureholders on the record date shall be deemed effective unless it shall
become effective pursuant to the provisions of this Indenture not later than six
months after the record date.
SECTION 10.2 PROOF OF EXECUTION BY DEBENTUREHOLDERS.
Subject to the provisions of Section 9.1, proof of the execution of any
instrument by a Debentureholder (such proof shall not require notarization) or
his agent or proxy and proof of the holding by any Person of any of the
Debentures shall be sufficient if made in the following manner:
(a) The fact and date of the execution by any such Person of any
instrument may be proved in any reasonable manner acceptable to the Trustee.
(b) The ownership of Debentures shall be proved by the Debenture
Register of such Debentures or by a certificate of the Debenture Registrar
thereof.
(c) The Trustee may require such additional proof of any matter
referred to in this Section 10.2 as it shall deem necessary.
SECTION 10.3 WHO MAY BE DEEMED OWNERS.
Prior to the due presentment for registration of transfer of any
Debenture, the Company, the Trustee, any paying agent, any Authenticating Agent
and any Debenture Registrar may deem and treat the Person in whose name such
Debenture shall be registered upon the books of the Company as the absolute
owner of such Debenture (whether or not such Debenture shall be overdue and
notwithstanding any notice of ownership or writing thereon made by anyone other
than the Debenture Registrar) for the purpose of receiving payment of or on
account of the principal of and interest on such Debenture (subject to Section
2.3) and for all other purposes;
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and neither the Company nor the Trustee nor any paying agent nor any
Authenticating Agent nor any Debenture Registrar shall be affected by any notice
to the contrary.
SECTION 10.4 CERTAIN DEBENTURES OWNED BY COMPANY DISREGARDED.
In determining whether the holders of the requisite aggregate principal
amount of Debentures have concurred in any direction, consent or waiver under
this Indenture, the Debentures that are owned by the Company or any other
obligor on the Debentures or by any Person directly or indirectly controlling or
controlled by, or under common control with the Company or any other obligor on
the Debentures shall be disregarded and deemed not to be Outstanding for the
purpose of any such determination, except that for the purpose of determining
whether the Trustee shall be protected in relying on any such direction, consent
or waiver, only Debentures that a Responsible Officer of the Trustee actually
knows are so owned shall be so disregarded. The Debentures so owned that have
been pledged in good faith may be regarded as Outstanding for the purposes of
this Section 10.4, if the pledgee shall establish to the satisfaction of the
Trustee the pledgee's right so to act with respect to such Debentures and that
the pledgee is not a Person directly or indirectly, controlling or controlled
by, or under direct or indirect common control with the Company or any such
other obligor. In case of a dispute as to such right, any decision by the
Trustee taken upon the advice of counsel shall be full protection to the
Trustee.
SECTION 10.5 ACTIONS BINDING ON FUTURE DEBENTUREHOLDERS.
At any time prior to (but not after) the evidencing to the Trustee, as
provided in Section 10.1, of the taking of any action by the holders of the
majority or percentage in aggregate principal amount of the Debentures specified
in this Indenture in connection with such action, any holder of a Debenture that
is shown by the evidence to be included in the Debentures the holders of which
have consented to such action may, by filing written notice with the Trustee,
and upon proof of holding as provided in Section 10.2, revoke such action so far
as concerns such Debenture. Except as aforesaid any such action taken by the
holder of any Debenture shall be conclusive and binding upon such holder and
upon all future holders and owners of such Debenture, and of any Debenture
issued in exchange therefor, on registration of transfer thereof or in place
thereof, irrespective of whether or not any notation in regard thereto is made
upon such Debenture. Any action taken by the holders of the majority or
percentage in aggregate principal amount of the Debentures specified in this
Indenture in connection with such action shall be conclusively binding upon the
Company, the Trustee and the holders of all the Debentures.
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ARTICLE XI
SUPPLEMENTAL INDENTURES
SECTION 11.1 SUPPLEMENTAL INDENTURES WITHOUT THE CONSENT OF DEBENTUREHOLDERS.
In addition to any supplemental indenture otherwise authorized by this
Indenture, the Company and the Trustee may from time to time and at any time
enter into an indenture or indentures supplemental hereto (which shall conform
to the provisions of the Trust Indenture Act as then in effect), without the
consent of the Debentureholders, for one or more of the following purposes:
(a) to cure any ambiguity, defect, or inconsistency herein, in the
Debentures;
(b) to comply with Article X;
(c) to provide for uncertificated Debentures in addition to or in place
of certificated Debentures;
(d) to add to the covenants of the Company for the benefit of the
holders of all or any of the Debentures or to surrender any right or power
herein conferred upon the Company;
(e) to evidence the succession of another corporation to the Company,
and the assumption by any such successor of the covenants of the Company herein
and in the Debentures contained;
(f) to convey, transfer, assign, mortgage or pledge to or with the
Trustee any property or assets which the Company may desire to convey, transfer,
assign, mortgage or pledge;
(g) to add to, delete from, or revise the conditions, limitations, and
restrictions on the authorized amount, terms, or purposes of issue,
authentication, and delivery of Debentures, as herein set forth;
(h) to make any change that does not adversely affect the rights of any
Debentureholder in any material respect;
(i) to provide for the issuance of and establish the form and terms and
conditions of the Debentures, to establish the form of any certifications
required to be furnished pursuant to the terms of this Indenture or of the
Debentures, or to add to the rights of the holders of the Debentures; or
(j) to qualify or maintain the qualification of this Indenture under
the Trust Indenture Act.
The Trustee is hereby authorized to join with the Company in the
execution of any such supplemental indenture, and to make any further
appropriate agreements and stipulations that may
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be therein contained, but the Trustee shall not be obligated to enter into any
such supplemental indenture that affects the Trustee's own rights, duties or
immunities under this Indenture or otherwise. Any supplemental indenture
authorized by the provisions of this Section 11.1 may be executed by the Company
and the Trustee without the consent of the holders of any of the Debentures at
the time Outstanding, notwithstanding any of the provisions of Section 11.2.
SECTION 11.2 SUPPLEMENTAL INDENTURES WITH CONSENT OF DEBENTUREHOLDERS.
With the consent (evidenced as provided in Section 10.1) of the holders
of not less than a majority in aggregate principal amount of the Debentures at
the time Outstanding, the Company, when authorized by Board Resolutions, and the
Trustee may from time to time and at any time enter into an indenture or
indentures supplemental hereto (which shall conform to the provisions of the
Trust Indenture Act as then in effect) for the purpose of adding any provisions
to or changing in any manner or eliminating any of the provisions of this
Indenture or of any supplemental indenture or of modifying in any manner not
covered by Section 11.1 the rights of the holders of the Debentures under this
Indenture; provided, however, that no such supplemental indenture shall without
the consent of the holders of each Debenture then Outstanding and affected
thereby, (i) extend the fixed maturity of any Debentures, reduce the principal
amount thereof, or reduce the rate or extend the time of payment of interest
thereon (other than the Company's right to defer interest pursuant to this
Indenture), without the consent of the holder of each Debenture so affected; or
(ii) reduce the aforesaid percentage of Debentures, the holders of which are
required to consent to any such supplemental indenture; provided further, that
if the Debentures are held by the Trust or a trustee of the Trust, such
supplemental indenture shall not be effective until the holders of a majority in
liquidation preference of Trust Securities of the Trust shall have consented to
such supplemental indenture; provided further, that if the consent of the holder
of each Outstanding Debenture is required, such supplemental indenture shall not
be effective until each holder of the Trust Securities of the Trust shall have
consented to such supplemental indenture. It shall not be necessary for the
consent of the Debentureholders affected thereby under this Section 11.2 to
approve the particular form of any proposed supplemental indenture, but it shall
be sufficient if such consent shall approve the substance thereof.
SECTION 11.3 EFFECT OF SUPPLEMENTAL INDENTURES.
Upon the execution of any supplemental indenture pursuant to the
provisions of this Article XI, this Indenture shall be and be deemed to be
modified and amended in accordance therewith and the respective rights,
limitations of rights, obligations, duties and immunities under this Indenture
of the Trustee, the Company and the holders of Debentures shall thereafter be
determined, exercised and enforced hereunder subject in all respects to such
modifications and amendments, and all the terms and conditions of any such
supplemental indenture shall be and be deemed to be part of the terms and
conditions of this Indenture for any and all purposes.
SECTION 11.4 DEBENTURES AFFECTED BY SUPPLEMENTAL INDENTURES.
Debentures affected by a supplemental indenture, authenticated and
delivered after the execution of such supplemental indenture pursuant to the
provisions of this Article XI, may bear
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a notation in form approved by the Company, provided such form meets the
requirements of any exchange upon which the Debentures may be listed, as to any
matter provided for in such supplemental indenture. If the Company shall so
determine, new Debentures so modified as to conform, in the opinion of the Board
of Directors of the Company, to any modification of this Indenture contained in
any such supplemental indenture may be prepared by the Company, authenticated by
the Trustee and delivered in exchange for the Debentures then Outstanding.
SECTION 11.5 EXECUTION OF SUPPLEMENTAL INDENTURES.
(a) Upon the request of the Company, accompanied by their Board
Resolutions authorizing the execution of any such supplemental indenture, and
upon the filing with the Trustee of evidence of the consent of Debentureholders
required to consent thereto as aforesaid, the Trustee shall join with the
Company in the execution of such supplemental indenture unless such supplemental
indenture affects the Trustee's own rights, duties or immunities under this
Indenture or otherwise, in which case the Trustee may in its discretion but
shall not be obligated to enter into such supplemental indenture. The Trustee,
subject to the provisions of Section 9.1, may receive an Opinion of Counsel as
conclusive evidence that any supplemental indenture executed pursuant to this
Article XI is authorized or permitted by, and conforms to, the terms of this
Article XI and that it is proper for the Trustee under the provisions of this
Article XI to join in the execution thereof.
(b) Promptly after the execution by the Company and the Trustee of any
supplemental indenture pursuant to the provisions of this Section 11.5, the
Trustee shall transmit by mail, first class postage prepaid, a notice, setting
forth in general terms the substance of such supplemental indenture, to the
Debentureholders as their names and addresses appear upon the Debenture
Register. Any failure of the Trustee to mail such notice, or any defect therein,
shall not, however, in any way impair or affect the validity of any such
supplemental indenture.
ARTICLE XII
SUCCESSOR CORPORATION
SECTION 12.1 COMPANY MAY CONSOLIDATE, ETC.
Nothing contained in this Indenture or in any of the Debentures shall
prevent any consolidation or merger of the Company with or into any other
corporation or corporations (whether or not affiliated with the Company, as the
case may be), or successive consolidations or mergers in which the Company, as
the case may be, or its successor or successors shall be a party or parties, or
shall prevent any sale, conveyance, transfer or other disposition of the
property of the Company, as the case may be, or its successor or successors as
an entirety, or substantially as an entirety, to any other corporation (whether
or not affiliated with the Company, as the case may be, or its successor or
successors) authorized to acquire and operate the same; provided, however, the
Company hereby covenants and agrees that, (i) upon any such consolidation,
merger, sale, conveyance, transfer or other disposition, the due and punctual
payment, in the case of the Company, of the principal of and interest on all of
the Debentures,
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according to their tenor and the due and punctual performance and observance of
all the covenants and conditions of this Indenture to be kept or performed by
the Company as the case may be, shall be expressly assumed, by supplemental
indenture (which shall conform to the provisions of the Trust Indenture Act, as
then in effect) satisfactory in form to the Trustee executed and delivered to
the Trustee by the entity formed by such consolidation, or into which the
Company, as the case may be, shall have been merged, or by the entity which
shall have acquired such property; (ii) in case the Company consolidates with or
merges into another Person or conveys or transfers its properties and assets
substantially then as an entirety to any Person, the successor Person is
organized under the laws of the United States or any state or the District of
Columbia; and (iii) immediately after giving effect thereto, no Event of
Default, and no event which, after notice or lapse of time or both, would become
an Event of Default, shall have occurred and be continuing.
SECTION 12.2 SUCCESSOR CORPORATION SUBSTITUTED.
(a) In case of any such consolidation, merger, sale, conveyance,
transfer or other disposition and upon the assumption by the successor
corporation, by supplemental indenture, executed and delivered to the Trustee
and satisfactory in form to the Trustee, of, in the case of the Company, the due
and punctual payment of the principal of and interest on all of the Debentures
Outstanding and the due and punctual performance of all of the covenants and
conditions of this Indenture to be performed by the Company, as the case may be,
such successor corporation shall succeed to and be substituted for the Company,
with the same effect as if it had been named as the Company herein, and
thereupon the predecessor corporation shall be relieved of all obligations and
covenants under this Indenture and the Debentures.
(b) In case of any such consolidation, merger, sale, conveyance,
transfer or other disposition such changes in phraseology and form (but not in
substance) may be made in the Debentures thereafter to be issued as may be
appropriate.
(c) Nothing contained in this Indenture or in any of the Debentures
shall prevent the Company from merging into itself or acquiring by purchase or
otherwise all or any part of the property of any other Person (whether or not
affiliated with the Company).
SECTION 12.3 EVIDENCE OF CONSOLIDATION, ETC. TO TRUSTEE.
The Trustee, subject to the provisions of Section 9.1, may receive an
Opinion of Counsel as conclusive evidence that any such consolidation, merger,
sale, conveyance, transfer or other disposition, and any such assumption, comply
with the provisions of this Article XII.
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ARTICLE XIII
SATISFACTION AND DISCHARGE
SECTION 13.1 SATISFACTION AND DISCHARGE OF INDENTURE.
If at any time: (a) the Company shall have delivered to the Trustee for
cancellation all Debentures theretofore authenticated (other than any Debentures
that shall have been destroyed, lost or stolen and that shall have been replaced
or paid as provided in Section 2.8) and Debentures for whose payment money or
Governmental Obligations have theretofore been deposited in trust or segregated
and held in trust by the Company (and thereupon repaid to the Company or
discharged from such trust, as provided in Section 13.5); or (b) all such
Debentures not theretofore delivered to the Trustee for cancellation shall have
become due and payable, or are by their terms to become due and payable within
one year or are to be called for redemption within one year under arrangements
satisfactory to the Trustee for the giving of notice of redemption, and the
Company shall deposit or cause to be deposited with the Trustee as trust funds
the entire amount in moneys or Governmental Obligations sufficient or a
combination thereof, sufficient in the opinion of a nationally recognized firm
of independent public accountants expressed in written certification thereof
delivered to the Trustee, to pay at maturity or upon redemption all Debentures
not theretofore delivered to the Trustee for cancellation, including principal
and interest due or to become due to such date of maturity or date fixed for
redemption, as the case may be, and if the Company shall also pay or cause to be
paid all other sums payable hereunder by the Company; then this Indenture shall
thereupon cease to be of further effect except for the provisions of Sections
2.3, 2.6, 2.8, 5.1, 5.2, 5.3 and 9.10, that shall survive until the date of
maturity or redemption date, as the case may be, and Sections 9.7 and 13.5, that
shall survive to such date and thereafter, and the Trustee, on demand of the
Company and at the cost and expense of the Company, shall execute proper
instruments acknowledging satisfaction of and discharging this Indenture.
SECTION 13.2 DISCHARGE OF OBLIGATIONS.
If at any time all Debentures not heretofore delivered to the Trustee
for cancellation or that have not become due and payable as described in Section
13.1 shall have been paid by the Company by depositing irrevocably with the
Trustee as trust funds moneys or an amount of Governmental Obligations
sufficient to pay at maturity or upon redemption all Debentures not theretofore
delivered to the Trustee for cancellation, including principal and interest due
or to become due to such date of maturity or date fixed for redemption, as the
case may be, and if the Company shall also pay or cause to be paid all other
sums payable hereunder by the Company, then after the date such moneys or
Governmental Obligations, as the case may be, are deposited with the Trustee,
the obligations of the Company under this Indenture shall cease to be of further
effect except for the provisions of Sections 2.3, 2.6, 2.8, 5.1, 5.2, 5.3, 9.7,
9.10 and 13.5 hereof that shall survive until such Debentures shall mature and
be paid. Thereafter, Sections 9.7 and 13.5 shall survive.
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SECTION 13.3 DEPOSITED MONEYS TO BE HELD IN TRUST.
All moneys or Governmental Obligations deposited with the Trustee
pursuant to Sections 13.1 or 13.2 shall be held in trust and shall be available
for payment as due, either directly or through any paying agent (including the
Company acting as its own paying agent), to the holders of the Debentures for
the payment or redemption of which such moneys or Governmental Obligations have
been deposited with the Trustee.
The Company shall pay and indemnify the Trustee against any tax, fee or
other charge imposed on or assessed against the Government Obligations deposited
pursuant to Section 13.1 or the principal and interest received in respect
thereof other than any such tax, fee or other charge which by law is for the
account of the holders of Outstanding Debentures.
SECTION 13.4 PAYMENT OF MONEYS HELD BY PAYING AGENTS.
In connection with the satisfaction and discharge of this Indenture,
all moneys or Governmental Obligations then held by any paying agent under the
provisions of this Indenture shall, upon demand of the Company, be paid to the
Trustee and thereupon such paying agent shall be released from all further
liability with respect to such moneys or Governmental Obligations.
SECTION 13.5 REPAYMENT TO COMPANY.
Any monies or Governmental Obligations deposited with any paying agent
or the Trustee, or then held by the Company in trust, for payment of principal
of or interest on the Debentures that are not applied but remain unclaimed by
the holders of such Debentures for at least two years after the date upon which
the principal of or interest on such Debentures shall have respectively become
due and payable, shall be repaid to the Company, as the case may be, on May 31
of each year or (if then held by the Company) shall be discharged from such
trust; and thereupon the paying agent and the Trustee shall be released from all
further liability, with respect to such money's or Governmental Obligations, and
the holder of any of the Debentures entitled to receive such payment shall
thereafter, as an unsecured general creditor, look only to the Company for the
payment thereof.
ARTICLE XIV
IMMUNITY OF INCORPORATORS, STOCKHOLDERS,
OFFICERS AND DIRECTORS
SECTION 14.1 NO RECOURSE.
No recourse under or upon any obligation, covenant or agreement of this
Indenture, or of the Debentures, or for any claim based thereon or otherwise in
respect thereof, shall be had against any incorporator, stockholder, officer or
director, past, present or future as such, of the Company or of any predecessor
or successor corporation, either directly or through the Company
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or any such predecessor or successor corporation, whether by virtue of any
constitution, statute or rule of law, or by the enforcement of any assessment or
penalty or otherwise; it being expressly understood that this Indenture and the
obligations issued hereunder are solely corporate obligations, and that no such
personal liability whatever shall attach to, or is or shall be incurred by, the
incorporators, stockholders, officers or directors as such, of the Company or of
any predecessor or successor corporation, or any of them, because of the
creation of the indebtedness hereby authorized, or under or by reason of the
obligations, covenants or agreements contained in this Indenture or in any of
the Debentures or implied therefrom; and that any and all such personal
liability of every name and nature, either at common law or in equity or by
constitution or statute, of, and any and all such rights and claims against,
every such incorporator, stockholder, officer or director as such, because of
the creation of the indebtedness hereby authorized, or under or by reason of the
obligations, covenants or agreements contained in this Indenture or in any of
the Debentures or implied therefrom, are hereby expressly waived and released as
a condition of, and as a consideration for, the execution of this Indenture and
the issuance of such Debentures.
ARTICLE XV
MISCELLANEOUS PROVISIONS
SECTION 15.1 EFFECT ON SUCCESSORS AND ASSIGNS.
All the covenants, stipulations, promises and agreements in this
Indenture contained by or on behalf of the Company shall bind their respective
successors and assigns, whether so expressed or not.
SECTION 15.2 ACTIONS BY SUCCESSOR.
Any act or proceeding by any provision of this Indenture authorized or
required to be done or performed by any board, committee or officer of the
Company shall and may be done and performed with like force and effect by the
corresponding board, committee or officer of any corporation that shall at the
time be the lawful sole successor of the Company.
SECTION 15.3 SURRENDER OF COMPANY POWERS.
The Company by instrument in writing executed by appropriate authority
of its Board of Directors and delivered to the Trustee may surrender any of the
powers reserved to the Company, and thereupon such power so surrendered shall
terminate both as to the Company as the case may be, and as to any successor
corporation.
SECTION 15.4 NOTICES.
Except as otherwise expressly provided herein any notice or demand that
by any provision of this Indenture is required or permitted to be given or
served by the Trustee or by the holders of Debentures to or on the Company may
be given or served by being deposited first class
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postage prepaid in a post-office letter box addressed (until another address is
filed in writing by the Company with the Trustee), as follows: American
Bancorporation, 1025 Main Street, Suite 800, Wheeling, West Virginia 26003,
Attention: Chairman of the Board and Chief Executive Officer. Any notice,
election, request or demand by the company or any Debentureholder to or upon the
Trustee shall be deemed to have been sufficiently given or made, for all
purposes, if given or made in writing at the Corporate Trust Office of the
Trustee.
SECTION 15.5 GOVERNING LAW.
This Indenture and each Debenture shall be deemed to be a contract made
under the internal laws of the State of New York and for all purposes shall be
construed in accordance with the laws of said State without regard to conflicts
of law principles.
SECTION 15.6 TREATMENT OF DEBENTURES AS DEBT.
It is intended that the Debentures shall be treated as indebtedness and
not as equity for federal income tax purposes. The provisions of this Indenture
shall be interpreted to further this intention.
SECTION 15.7 COMPLIANCE CERTIFICATES AND OPINIONS.
(a) Upon any application or demand by the Company to the Trustee to
take any action under any of the provisions of this Indenture, the Company shall
furnish to the Trustee an Officers' Certificate stating that all conditions
precedent provided for in this Indenture relating to the proposed action have
been complied with and an Opinion of Counsel stating that in the opinion of such
counsel all such conditions precedent have been complied with, except that in
the case of any such application or demand as to which the furnishing of such
documents is specifically required by any provision of this Indenture relating
to such particular application or demand, no additional certificate or opinion
need be furnished.
(b) Each certificate or opinion of the Company provided for in this
Indenture and delivered to the Trustee with respect to compliance with a
condition or covenant in this Indenture shall include (1) a statement that the
Person making such certificate or opinion has read such covenant or condition;
(2) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such
certificate or opinion are based; (3) a statement that, in the opinion of such
Person, he has made such examination or investigation as, in the opinion of such
Person, is necessary to enable him to express an informed opinion as to whether
or not such covenant or condition has been complied with; and (4) a statement as
to whether or not, in the opinion of such Person, such condition or covenant has
been complied with.
SECTION 15.8 PAYMENTS ON BUSINESS DAYS.
In any case where the date of maturity of interest or principal of any
Debenture or the date of redemption of any Debenture shall not be a Business
Day, then payment of interest or
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principal may (subject to Section 2.4) be made on the next succeeding Business
Day with the same force and effect as if made on the nominal date of maturity or
redemption, and no interest shall accrue for the period after such nominal date,
except that, if such business day is in the next succeeding calendar year, such
payment shall be made on the immediately preceding Business Day, in such case
with the same force and effect as if made on the date such payment was
originally payable.
SECTION 15.9 CONFLICT WITH TRUST INDENTURE ACT.
If and to the extent that any provision of this Indenture limits,
qualifies or conflicts with the duties imposed by Sections 310 to 317,
inclusive, of the Trust Indenture Act, such imposed duties shall control.
SECTION 15.10 COUNTERPARTS.
This Indenture may be executed in any number of counterparts, each of
which shall be an original, but such counterparts shall together constitute but
one and the same instrument.
SECTION 15.11 SEPARABILITY.
In case any one or more of the provisions contained in this Indenture
or in the Debentures shall for any reason be held to be invalid, illegal or
unenforceable in any respect, such invalidity, illegality or unenforceability
shall not affect any other provisions of this Indenture or of the Debentures,
but this Indenture and the Debentures shall be construed as if such invalid or
illegal or unenforceable provision had never been contained herein or therein.
SECTION 15.12 ASSIGNMENT.
The Company shall have the right at all times to assign any of its
respective rights or obligations under this Indenture to a direct or indirect
wholly owned Subsidiary of the Company, provided that, in the event of any such
assignment, the Company shall remain liable for all such obligations. Subject to
the foregoing, this Indenture is binding upon and inures to the benefit of the
parties hereto and their respective successors and assigns. This Indenture may
not otherwise be assigned by the parties hereto.
SECTION 15.13 ACKNOWLEDGMENT OF RIGHTS.
The Company acknowledges that, with respect to any Debentures held by
the Trust or a trustee of the Trust, if the Property Trustee fails to enforce
its rights under this Indenture as the holder of the Debentures held as the
assets of the Trust, any holder of Preferred Securities may institute legal
proceedings directly against the Company to enforce such Property Trustee's
rights under this Indenture without first instituting any legal proceedings
against such Property Trustee or any other person or entity. Notwithstanding the
foregoing, if an Event of Default has occurred and is continuing and such event
is attributable to the failure of the Company to pay interest or principal on
the Debentures on the date such interest or principal is otherwise payable for
in the
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case of redemption, on the redemption date), the Company acknowledges that a
holder of Preferred Securities may directly institute a proceeding for
enforcement of payment to such holder of the principal of or interest on the
Debentures having a principal amount equal to the aggregate liquidation amount
of the Preferred Securities of such holder on or after the respective due date
specified in the Debentures.
ARTICLE XVI
SUBORDINATION OF DEBENTURES
SECTION 16.1 AGREEMENT TO SUBORDINATE.
The Company covenants and agrees, and each holder of Debentures issued
hereunder by such holder's acceptance thereof likewise covenants and agrees,
that all Debentures shall be issued subject to the provisions of this Article
XVI; and each holder of a Debenture, whether upon original issue or upon
transfer or assignment thereof, accepts and agrees to be bound by such
provisions. The payment by the Company of the principal of and interest on all
Debentures issued hereunder shall, to the extent and in the manner hereinafter
set forth, be subordinated and junior in right of payment to the prior payment
in full of all Senior Debt and Subordinated Debt (collectively, "Senior
Indebtedness") to the extent provided herein, whether outstanding at the date of
this Indenture or thereafter incurred. No provision of this Article XVI shall
prevent the occurrence of any default or Event of Default hereunder.
SECTION 16.2 DEFAULT ON SENIOR DEBT OR SUBORDINATED DEBT.
In the event and during the continuation of any default by the Company
in the payment of principal, premium, interest or any other payment due on any
Senior Indebtedness of the Company, or in the event that the maturity of any
Senior Indebtedness of the Company has been accelerated because of a default,
then, in either case, no payment shall be made by the Company with respect to
the principal (including redemption payments) of or interest on the Debentures.
In the event that, notwithstanding the foregoing, any payment shall be received
by the Trustee when such payment is prohibited by the preceding sentence of this
Section 16.2, such payment shall be held in trust for the benefit of, and shall
be paid over or delivered to, the holders of Senior Indebtedness or their
respective representatives, or to the trustee or trustees under any indenture
pursuant to which any of such Senior Indebtedness may have been issued, as their
respective interests may appear, but only to the extent that the holders of the
Senior Indebtedness for their representative or representatives or a trustee)
notify the Company or the Trustee in writing within 90 days of such payment of
the amounts then due and owing on the Senior Indebtedness and only the amounts
specified in such notice to the Trustee shall be paid to the holders of Senior
Indebtedness.
SECTION 16.3 LIQUIDATION; DISSOLUTION; BANKRUPTCY.
(a) Upon any payment by the Company or distribution of assets of the
Company of any kind or character, whether in cash, property or securities, to
creditors upon any liquidation,
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dissolution or winding-up, reorganization, assignment for the benefit of
creditors, marshaling of assets or any bankruptcy, insolvency, debt
restructuring or similar proceedings in connection with any insolvency or
bankruptcy proceeding of the Company, all amounts due upon all Senior
Indebtedness of the Company shall first be paid in full, or payment thereof
provided for in money in accordance with its terms, before any payment is made
by the Company on account of the principal or interest on the Debentures; and
upon any such liquidation, dissolution, winding-up, reorganization, assignment
for the benefit of creditors, marshaling of assets, any payment by the Company,
or distribution of assets of the Company of any kind or character, whether in
cash, property or securities, to which the holders of the Debentures or the
Trustee would be entitled to receive from the Company, except for the provisions
of this Article XVI, shall be paid by the Company or by any receiver, trustee in
bankruptcy, liquidating trustee, agent or other Person making such payment or
distribution, or by the holders of the Debentures or by the Trustee under this
Indenture if received by them or it, directly to the holders of Senior
Indebtedness of the Company (pro rata to such holders on the basis of the
respective amounts of Senior Indebtedness held by such holders, as calculated by
the Company) or their representative or representatives, or to the trustee or
trustees under any indenture pursuant to which any instruments evidencing such
Senior Indebtedness may have been issued, as their respective interests may
appear, to the extent necessary to pay such Senior Indebtedness in full, in
money or money's worth, after giving effect to any concurrent payment or
distribution to or for the holders of such Senior Indebtedness, before any
payment or distribution is made to the holders of Debentures or to the Trustee.
(b) In the event that, notwithstanding the foregoing, any payment or
distribution of assets of the Company of any kind or character, whether in cash,
property or securities, prohibited by the foregoing, shall be received by the
Trustee before all Senior Indebtedness of the Company is paid in full, or
provision is made for such payment in money in accordance with its terms, such
payment or distribution shall be held in trust for the benefit of and shall be
paid over or delivered to the holders of such Senior Indebtedness or their
representative or representatives, or to the trustee or trustees under any
indenture pursuant to which any instruments evidencing such Senior Indebtedness
may have been issued, as their respective interests may appear, as calculated by
the Company, for application to the payment of all Senior Indebtedness of the
Company, as the case may be, remaining unpaid to the extent necessary to pay
such Senior Indebtedness in full in money in accordance with its terms, after
giving effect to any concurrent payment or distribution to or for the benefit of
the holders of such Senior Indebtedness.
(c) For purposes of this Article XVI, the words "cash, property or
securities" shall not be deemed to include shares of stock of the Company as
reorganized or readjusted, or securities of the Company or any other corporation
provided for by a plan of reorganization or readjustment, the payment of which
is subordinated at least to the extent provided in this Article XVI with respect
to the Debentures to the payment of all Senior Indebtedness of the Company, as
the case may be, that may at the time be outstanding, provided that (i) such
Senior Indebtedness is assumed by the new corporation, if any, resulting from
any such reorganization or readjustment; and (ii) the rights of the holders of
such Senior Indebtedness are not, without the consent of such holders, altered
by such reorganization or readjustment. The consolidation of the Company with,
or the merger of the Company into, another corporation or the liquidation or
dissolution of the Company following the conveyance or transfer of its property
as an entirety,
54
<PAGE>
or substantially as an entirety, to another corporation upon the terms and
conditions provided for in Article XII shall not be deemed a dissolution,
winding-up, liquidation or reorganization for the purposes of this Section 16.3
if such other corporation shall, as a part of such consolidation. merger,
conveyance or transfer, comply with the conditions stated in Article XII.
Nothing in Section 16.2 or in this Section 16.3 shall apply to claims of, or
payments to, the Trustee under or pursuant to Section 9.7.
SECTION 16.4 SUBROGATION.
(a) Subject to the payment in full of all Senior Indebtedness of the
Company, the rights of the holders of the Debentures shall be subrogated to the
rights of the holders of such Senior Indebtedness to receive payments or
distributions of cash, property or securities of the Company, as the case may
be, applicable to such Senior Indebtedness until the principal of and interest
on the Debentures shall be paid in full; and for the purposes of such
subrogation, no payments or distributions to the holders of such Senior
Indebtedness of any cash, property or securities to which the holders of the
Debentures or the Trustee would be entitled except for the provisions of this
Article XVI, and no payment over pursuant to the provisions of this Article XVI
to or for the benefit of the holders of such Senior Indebtedness by holders of
the Debentures or the Trustee, shall, as between the Company, its creditors
other than holders of Senior Indebtedness of the Company, and the holders of the
Debentures, be deemed to be a payment by the Company to or on account of such
Senior Indebtedness. It is understood that the provisions of this Article XVI
are and are intended solely for the purposes of defining the relative rights of
the holders of the Debentures, on the one hand, and the holders of such Senior
Indebtedness on the other hand.
(b) Nothing contained in this Article XVI or elsewhere in this
Indenture or in the Debentures is intended to or shall impair, as between the
Company, its creditors (other than the holders of Senior Indebtedness of the
Company), and the holders of the Debentures, the obligation of the Company,
which is absolute and unconditional, to pay to the holders of the Debentures the
principal of and interest on the Debentures as and when the same shall become
due and payable in accordance with their terms, or is intended to or shall
affect the relative rights of the holders of the Debentures and creditors of the
Company, as the case may be, other than the holders of Senior Indebtedness of
the Company, nor shall anything herein or therein prevent the Trustee or the
holder of any Debenture from exercising all remedies otherwise permitted by
applicable law upon default under this Indenture, subject to the rights, if any,
under this Article XVI of the holders of such Senior Indebtedness in respect of
cash, property or securities of the Company, as the case may be, received upon
the exercise of any such remedy.
(c) Upon any payment or distribution of assets of the Company referred
to in this Article XVI, the Trustee, subject to the provisions of Article IX,
and the holders of the Debentures shall be entitled to conclusively rely upon
any order or decree made by any court of competent jurisdiction in which such
dissolution, winding-up, liquidation or reorganization proceedings are pending,
or a certificate of the receiver, trustee in bankruptcy, liquidation trustee,
agent or other Person making such payment or distribution, delivered to the
Trustee or to the holders of the Debentures, for the purposes of ascertaining
the Persons entitled to participate in
55
<PAGE>
such distribution, the holders of Senior Indebtedness and other indebtedness of
the Company, as the case may be, the amount thereof or payable thereon, the
amount or amounts paid or distributed thereon and all other facts pertinent
thereto or to this Article XVI.
SECTION 16.5 TRUSTEE TO EFFECTUATE SUBORDINATION.
Each holder of Debentures by such holder's acceptance thereof
authorizes and directs the Trustee on such holder's behalf to tale such action
as may be necessary or appropriate to effectuate the subordination provided in
this Article XVI and appoints the Trustee such holder's attorney-in-fact for any
and all such purposes.
SECTION 16.6 NOTICE BY THE COMPANY.
(a) The Company shall give prompt written notice to a Responsible
Officer of the Trustee of any fact known to the Company that would prohibit the
making of any payment of monies to or by the Trustee in respect of the
Debentures pursuant to the provisions of this Article XVI. Notwithstanding the
provisions of this Article XVI or any other provisions of this Indenture, the
Trustee shall not be charged with knowledge of the existence of any facts that
would prohibit the making of any payment of monies to or by the Trustee in
respect of the Debentures pursuant to the provisions of this Article XVI, unless
and until a Responsible Officer of the Trustee shall have received written
notice thereof from the Company or a holder or holders of Senior Indebtedness or
from any trustee therefor, and before the receipt of any such written notice,
the Trustee, subject to the provisions of Section 9.1, shall not be entitled in
all respects to assume that no such facts exist; provided, however, that if the
Trustee shall not have received the notice provided for in this Section 16.6 at
least two Business Days prior to the date upon which by the terms hereof any
money may become payable for any purpose (including, without limitation, the
payment of the principal of or interest on any Debenture), then, anything herein
contained to the contrary notwithstanding, the Trustee shall have full power and
authority to receive such money and to apply the same to the purposes for which
they were received, and shall not be affected by any notice to the contrary that
may be received by it within two Business Days prior to such date.
(b) The Trustee, subject to the provisions of Section 9.1, shall be
entitled to conclusively rely on the delivery to it of a written notice by a
Person representing himself to be a holder of Senior Indebtedness of the Company
(or a trustee on behalf of such holder) to establish that such notice has been
given by a holder of such Senior Indebtedness or a trustee on behalf of any such
holder or holders. In the event that the Trustee determines in good faith that
further evidence is required with respect to the right of any Person as a holder
of such Senior Indebtedness to participate in any payment or distribution
pursuant to this Article XVI, the Trustee may request such Person to furnish
evidence to the reasonable satisfaction of the Trustee as to the amount of such
Senior Indebtedness held by such Person, the extent to which such Person is
entitled to participate in such payment or distribution and any other facts
pertinent to the rights of such Person under this Article XVI, and, if such
evidence is not furnished, the Trustee may defer any payment to such Person
pending judicial determination as to the right of such Person to receive such
payment.
56
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SECTION 16.7 RIGHTS OF THE TRUSTEE; HOLDERS OF SENIOR INDEBTEDNESS.
(a) The Trustee in its individual capacity shall be entitled to all the
rights set forth in this Article XVI in respect of any Senior Indebtedness at
any time held by it, to the same extent as any other holder of Senior
Indebtedness, and nothing in this Indenture shall deprive the Trustee of any of
its rights as such holder. The Trustee's right to compensation and reimbursement
of expenses as set forth in Section 9.7 shall not be subject to the
subordination provisions of this Article XVI.
(b) With respect to the holders of Senior Indebtedness of the Company,
the Trustee undertakes to perform or to observe only such of its covenants and
obligations as are specifically set forth in this Article XVI, and no implied
covenants or obligations with respect to the holders of such Senior Indebtedness
shall be read into this Indenture against the Trustee. The Trustee shall not be
deemed to have any fiduciary duty to the holders of such Senior Indebtedness
and, subject to the provisions of Section 9.1, the Trustee shall not be liable
to any holder of such Senior Indebtedness if it shall in good faith mistakenly
pay over or deliver to holders of Debentures, the Company or any other Person
money or assets to which any holder of such Senior Indebtedness shall be
entitled by virtue of this Article XVI or otherwise.
SECTION 16.8 SUBORDINATION MAY NOT BE IMPAIRED.
(a) No right of any present or future holder of any Senior Indebtedness
of the Company to enforce subordination as herein provided shall at any time in
any way be prejudiced or impaired by any act or failure to act on the part of
the Company or by any act or failure to act, in good faith, by any such holder,
or by any noncompliance by the Company with the terms, provisions and covenants
of this Indenture, regardless of any knowledge thereof that any such holder may
have or otherwise be charged with.
(b) Without in any way limiting the generality of the foregoing
paragraph, the holders of Senior Indebtedness of the Company may, at any time
and from time to time, without the consent of or notice to the Trustee or the
holders of the Debentures, without incurring responsibility to the holders of
the Debentures and without impairing or releasing the subordination provided in
this Article XVI or the obligations hereunder of the holders of the Debentures
to the holders of such Senior Indebtedness, do any one or more of the following:
(i) change the manner, place or terms of payment or extend the time of payment
of, or renew or alter, such Senior Indebtedness, or otherwise amend or
supplement in any manner such Senior Indebtedness or any instrument evidencing
the same or any agreement under which such Senior Indebtedness is outstanding;
(ii) sell, exchange, release or otherwise deal with any property pledged,
mortgaged or otherwise securing such Senior Indebtedness; (iii) release any
Person liable in any manner for the collection of such Senior Indebtedness; and
(iv) exercise or refrain from exercising any rights against the Company and any
other Person.
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IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed all as of the day and year first above written.
AMERICAN BANCORPORATION
By:
----------------------------------------
Name: Jeremy C. McCamic
Title: Chairman of the Board and
Chief Executive Officer
THE BANK OF NEW YORK, AS TRUSTEE
By:
----------------------------------------
Name:
----------------------------------------
Title:
----------------------------------------
58
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EXHIBIT A
FACE OF DEBENTURE
NO. ___ $__________
CUSIP NO. 024076-AA-9
AMERICAN BANCORPORATION
_____% JUNIOR SUBORDINATED DEFERRABLE INTEREST DEBENTURE
DUE APRIL ___, 2028
THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE
HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITARY OR A
NOMINEE OF A DEPOSITARY. THIS SECURITY IS EXCHANGEABLE FOR SECURITIES REGISTERED
IN THE NAME OF A PERSON OTHER THAN THE DEPOSITARY OR ITS NOMINEE ONLY IN THE
LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE AND MAY NOT BE TRANSFERRED
EXCEPT AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A
NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE
DEPOSITARY, EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE.
American Bancorporation, an Ohio corporation (the "Company," which term
includes any successor corporation under the Indenture hereinafter referred to),
for value received, hereby promises to pay to The Bank of New York, as Property
Trustee for American Bancorporation Capital Trust I, or registered assigns, the
principal sum of __________________________________________________________
($__________) on April __, 2028 (the "Stated Maturity"), and to pay interest on
said principal sum from _________ 1998, or from the most recent interest payment
date (each such date, an "Interest Payment Date") to which interest has been
paid or duly provided for, quarterly (subject to deferral as set forth herein)
in arrears on March 1, June 1, September 1 and December 1 of each year
commencing _________ __, 1998, at the rate of _____% per annum until the
principal hereof shall have become due and payable, and on any overdue principal
and (without duplication) on any overdue installment of interest at the rate of
_____% per annum compounded quarterly. The amount of interest payable on any
Interest Payment Date shall be computed on the basis of a 360-day year of twelve
30-day months and for any period of less than a full month, the actual number of
days lapsed in such period, based on a thirty day month. In the event that any
date on which interest is payable on this Debenture is not a business day, then
payment of interest payable on such date shall be made on the next succeeding
day that is a business day (and without any interest or other payment in respect
of any such delay), except that, if such business day is in the next succeeding
calendar year, such payment shall be made on the preceding business day, in each
case with the same force and effect as if made on such date. The interest
installment so payable, and punctually, paid or duly provided for, on any
Interest Payment Date shall, as provided in the Indenture, be paid to the person
in whose name this Debenture (or one or more Predecessor Debentures, as defined
in said Indenture) is registered at the close of business on the regular record
date for such interest installment, which shall be the close of business on the
business day 15 days prior to such Interest Payment Date unless otherwise
provided in the Indenture. Any such interest installment not punctually paid or
duly provided for shall forthwith cease to be payable to the registered holders
on such regular record date and may be paid to the Person in whose
<PAGE>
name this Debenture (or one or more Predecessor Debentures) is registered at the
close of business on a special record date to be fixed by the Trustee for the
payment of such defaulted interest, notice whereof shall be given to the
registered holders of the Debentures not less than 10 days prior to such special
record date, or may be paid at any time in any other lawful manner not
inconsistent with the requirements of any securities exchange on which the
Debentures may be listed, and upon such notice as may be required by such
exchange, all as more fully provided in the Indenture. The principal of and the
interest on this Debenture shall be payable at the office or agency of the
Trustee maintained for that purpose in any coin or currency of the United States
of America that at the time of payment is legal tender for payment of public and
private debts; provided, however, that payment of interest may be made at the
option of the Company by check mailed to the registered holder at such address
as shall appear in the Debenture Register. Notwithstanding the foregoing, so
long as the holder of this Debenture is the Property Trustee, the payment of the
principal of and interest on this Debenture shall be made at such place and to
such account as may be designated by the Trustee.
The indebtedness evidenced by this Debenture is, to the extent provided
in the Indenture, subordinate and junior in right of payment to the prior
payment in full of all Senior Indebtedness, and this Debenture is issued subject
to the provisions of the Indenture with respect thereto. Each holder of this
Debenture, by accepting the same, (a) agrees to and shall be bound by such
provisions; (b) authorizes and directs the Trustee on his or her behalf to take
such action as may be necessary or appropriate to acknowledge or effectuate the
subordination so provided; and (c) appoints the Trustee his or her
attorney-in-fact for any and all such purposes. Each holder hereof, by his or
her acceptance hereof, hereby waives all notice of the acceptance of the
subordination provisions contained herein and in the Indenture by each holder of
Senior Indebtedness, whether now outstanding or hereafter incurred, and waives
reliance by each such holder upon said provisions.
This Debenture shall not be entitled to any benefit under the Indenture
hereinafter referred to, be valid or become obligatory for any purpose until the
Certificate of Authentication hereon shall have been signed by or on behalf of
the Trustee.
This Debenture shall be deemed to be a contract made under the laws of
the State of New York and for all purposes shall be construed in accordance with
the laws of New York without regard to conflicts of laws principles.
The provisions of this Debenture are continued on the reverse side
hereof and such continued provisions shall for all purposes have the same effect
as though fully set forth at this place.
2
<PAGE>
IN WITNESS WHEREOF, the Company has caused this instrument to be
executed.
AMERICAN BANCORPORATION
By:
------------------------------------
Name: Jeremy C. McCamic
Title: Chairman of the Board and
Chief Executive Officer
Attest:
By:
-----------------------------
Name: Brent E. Richmond
Title: Executive Vice President and
Chief Financial Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Debentures described in the within-mentioned
Indenture.
Dated:
THE BANK OF NEW YORK as Trustee or Authentication Agent
By: By:
-------------------------- ----------------------
Authorized Signatory
3
<PAGE>
REVERSE OF DEBENTURE
_____% JUNIOR SUBORDINATED DEFERRABLE INTEREST DEBENTURE
(CONTINUED )
This Debenture is one of the subordinated debentures of the Company
(herein sometimes referred to as the "Debentures"), specified in the Indenture,
all issued or to be issued under and pursuant to an Indenture dated as of April
__, 1998 (the "Indenture") duly executed and delivered between the Company and
The Bank of New York, as Trustee (the "Trustee"), to which Indenture reference
is hereby made for a description of the rights, limitations of rights,
obligations, duties and immunities thereunder of the Trustee, the Company and
the holders of the Debentures. The Debentures are limited in aggregate principal
amount as specified in the Indenture.
The Company has the right to redeem this Debenture at the option of the
Company, without premium or penalty (i) at any time on or after April __, 2003
in whole or in part, or (ii) at any time in certain circumstances in whole (but
not in part) upon the occurrence of a Special Event, in each case at a
Redemption Price equal to 100% of the principal amount plus any accrued but
unpaid interest, to the date of such redemption (the "Redemption Price"). The
Redemption Price shall be paid prior to 12:00 noon, Eastern Standard Time, on
the date of such redemption or at such earlier time as the Company determines.
The Company shall deposit the Redemption Price with the Trustee prior to 10:00
a.m. on the redemption date. Any redemption pursuant to this paragraph shall be
made upon not less than 30 days nor more than 60 days notice, at the Redemption
Price. If the Debentures are only partially redeemed by the Company, the
Debentures shall be redeemed pro rata or by lot or by any other method utilized
by the Trustee.
In the event of redemption of this Debenture in part only, a new
Debenture or Debentures for the unredeemed portion hereof shall be issued in the
name of the holder hereof upon the cancellation hereof.
In case an Event of Default, as defined in the Indenture, shall have
occurred and be continuing, the principal of all of the Debentures may be
declared, and upon such declaration shall become, due and payable, in the
manner, with the effect and subject to the conditions provided in the Indenture.
The Indenture contains provisions permitting the Company and the
Trustee, with the consent of the holders of not less than a majority in
aggregate principal amount of the Debentures at the time outstanding, as defined
in the Indenture, to execute supplemental indentures for the purpose of adding
any provisions to or changing in any manner or eliminating any of the provisions
of the Indenture or of any supplemental indenture or of modifying in any manner
the rights of the holders of the Debentures; provided, however, that no such
supplemental indenture shall (i) extend the fixed maturity of the Debentures
except as provided in the Indenture, or reduce the principal amount thereof, or
reduce the rate or extend the time of payment of interest thereon (except for
deferrals of interest as described below), without the consent of the holder of
each Debenture so affected; or (ii) reduce the aforesaid percentage of
Debentures, the holders of which are required to consent to any such
supplemental indenture, without the consent of the holders of each Debenture
then outstanding and affected thereby. The Indenture also contains
<PAGE>
provisions permitting the holders of a majority in aggregate principal amount of
the Debentures at the time outstanding, on behalf of all of the holders of the
Debentures, to waive any past default in the performance of any of the covenants
contained in the Indenture, or established pursuant to the Indenture, and its
consequences, except a default in the payment of the principal of or interest on
any of the Debentures. Any such consent or waiver by the registered holder of
this Debenture (unless revoked as provided in the Indenture) shall be conclusive
and binding upon such holder and upon all future holders and owners of this
Debenture and of any Debenture issued in exchange therefor or in place thereof
(whether by registration of transfer or otherwise or whether any notation of
such consent or waiver is made upon this Debenture).
No reference herein to the Indenture and no provision of this Debenture
or of the Indenture shall alter or impair the obligation of the Company, which
is absolute and unconditional, to pay the principal and interest on this
Debenture at the time and place and at the rate and in the money herein
prescribed.
So long as no Event of Default has occurred and is continuing, the
Company shall have the right at any time during the term of the Debentures and
from time to time to extend the interest payment period of such Debentures for
up to 20 consecutive quarters (each, an "Extended Interest Payment Period"), at
the end of which period the Company shall pay all interest then accrued and
unpaid (together with interest thereon at the rate specified for the Debentures
to the extent that payment of such interest is enforceable under applicable
law). Before the termination of any such Extended Interest Payment Period, the
Company may further extend such Extended Interest Payment Period, provided that
such Extended Interest Payment Period together with all such further extensions
thereof shall not exceed 20 consecutive quarters. At the termination of any such
Extended Interest Payment Period and upon the payment of all accrued and unpaid
interest and any additional amounts then due, the Company may commence a new
Extended Interest Payment Period.
As provided in the Indenture and subject to certain limitations therein
set forth, this Debenture is transferable by the registered holder hereof on the
Debenture Register of the Company, upon surrender of this Debenture for
registration of transfer at the office or agency of the Trustee accompanied by a
written instrument or instruments of transfer in form satisfactory to the
Company or the Trustee duly executed by the registered holder hereof or his
attorney duly authorized in writing, and thereupon one or more new Debentures of
authorized denominations and for the same aggregate principal amount shall be
issued to the designated transferee or transferees. No service charge shall be
made for any such transfer, but the Company may require payment of a sum
sufficient to cover any tax or other governmental charge payable in relation
thereto.
Prior to due presentment for registration of transfer of this
Debenture, the Company, the Trustee, any paying agent and the Debenture
Registrar may deem and treat the registered holder hereof as the absolute owner
hereof (whether or not this Debenture shall be overdue and notwithstanding any
notice of ownership or writing hereon made by anyone other than the Debenture
Registrar) for the purpose of receiving payment of or on account of the
principal hereof and interest due hereon and for all other purposes, and neither
the Company nor the
2
<PAGE>
Trustee nor any paying agent nor any Debenture Registrar shall be affected by
any notice to the contrary.
No recourse shall be had for the payment of the principal of or the
interest on this Debenture, or for any claim based hereon, or otherwise in
respect of the Indenture, against any incorporator, stockholder, officer or
director, past, present or future, as such, of the Company or any predecessor or
successor corporation, whether by virtue of any constitution, statute or rule of
law, or by the enforcement of any assessment or penalty or otherwise, all such
liability being, by the acceptance hereof and as part of the consideration for
the issuance hereof, expressly waived and released.
The Debentures are issuable only in registered form without coupons in
denominations of $10 and any integral multiple thereof.
All terms used in this Debenture that are defined in the Indenture
shall have the meanings assigned to them in the Indenture.
The Note is unsecured by any collateral, including the assets of the
Company or any of its subsidiaries or other affiliates.
3
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned assigns and transfers this Security
certificate to:
(Insert assignee's social security or tax identification number)
(Insert address and zip code of assignee)
and irrevocably appoints
______________________________agent to transfer this Security certificate on the
books of the Company. The agent may substitute another to act for him or her.
Date:_____________________________
Signature:______________________________________________________________________
(Sign exactly as your name appears on the other side of this Security)
Signature Guarantee:____________________________________________________________
- -------------------------
Signature must be guaranteed by an "eligible guarantor institution" that
is a bank, stockbroker, savings and loan association or credit union
meeting the requirements of the Registrar, which requirements include
membership or participation in the Securities Transfer Agents Medallion
Program ("STAMP") or such other "signature guarantee program" as may be
determined by the Registrar in addition to, or in substitution for, STAMP,
all in accordance with the Securities and Exchange Act of 1934, as
amended.
4
EXHIBIT #4.4
------------
AMENDED AND RESTATED TRUST AGREEMENT
AMONG
AMERICAN BANCORPORATION, AS DEPOSITOR
THE BANK OF NEW YORK, AS PROPERTY TRUSTEE
THE BANK OF NEW YORK (DELAWARE), AS DELAWARE TRUSTEE
AND
THE ADMINISTRATIVE TRUSTEES NAMED HEREIN
DATED AS OF APRIL ___, 1998
AMERICAN BANCORPORATION CAPITAL TRUST I
<PAGE>
TABLE OF CONTENTS
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ARTICLE I DEFINED TERMS
Section 101. Definitions................................................................... 2
ARTICLE II ESTABLISHMENT OF THE TRUST
Section 201. Name.......................................................................... 10
Section 202. Office of The Delaware Trustee; Principal Place of Business................... 11
Section 203. Initial Contribution of Trust Property; Organizational Expenses............... 11
Section 204. Issuance of The Preferred Securities.......................................... 11
Section 205. Issuance of The Common Securities; Subscription And Purchase of
Debentures.................................................................... 11
Section 206. Declaration of Trust.......................................................... 12
Section 207. Authorization to Enter Into Certain Transactions.............................. 12
Section 208. Assets of Trust............................................................... 16
Section 209. Title to Trust Property....................................................... 16
ARTICLE III PAYMENT ACCOUNT
Section 301. Payment Account............................................................... 16
ARTICLE IV DISTRIBUTIONS; REDEMPTION
Section 401. Distributions................................................................. 17
Section 402. Redemption.................................................................... 18
Section 403. Subordination of Common Securities............................................ 20
Section 404. Payment Procedures............................................................ 21
Section 405. Tax Returns And Reports....................................................... 21
Section 406. Payment of Taxes, Duties, Etc. of The Trust................................... 21
Section 407. Payments Under Indenture...................................................... 21
ARTICLE V TRUST SECURITIES CERTIFICATES
Section 501. Initial Ownership............................................................. 22
Section 502. The Trust Securities Certificates............................................. 22
Section 503. Execution And Delivery of Trust Securities Certificates....................... 22
Section 503a. Global Preferred Securities................................................... 23
Section 504. Registration of Transfer And Exchange of Preferred Securities
Certificates.................................................................. 25
Section 505. Mutilated, Destroyed, Lost or Stolen Trust Securities Certificates............ 26
Section 506. Persons Deemed Securityholders................................................ 27
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Section 507. Access to List of Securityholders' Names And Addresses........................ 27
Section 508. Maintenance of Office or Agency............................................... 27
Section 509. Appointment of Paying Agent................................................... 28
Section 510. Ownership of Common Securities by Depositor................................... 28
Section 511. Notices to Clearing Agency.................................................... 28
Section 511a. Definitive Preferred Securities Certificate and Temporary Preferred
Securities.................................................................... 29
Section 512. Rights of Securityholders..................................................... 29
Section 513. CUSIP Numbers................................................................. 32
ARTICLE VI ACTS OF SECURITYHOLDERS; MEETINGS; VOTING
Section 601. Limitations on Voting Rights.................................................. 32
Section 602. Notice of Meetings............................................................ 33
Section 603. Meetings of Preferred Securityholders......................................... 33
Section 604. Voting Rights................................................................. 34
Section 605. Proxies, Etc.................................................................. 34
Section 606. Securityholder Action by Written Consent...................................... 34
Section 607. Record Date For Voting And Other Purposes..................................... 34
Section 608. Acts of Securityholders....................................................... 34
Section 609. Inspection of Records......................................................... 35
ARTICLE VII REPRESENTATIONS AND WARRANTIES
Section 701. Representations And Warranties of The Property Trustee And The
Delaware Trustee.............................................................. 36
Section 702. Representations And Warranties of Depositor................................... 37
ARTICLE VIII TRUSTEES
Section 801. Certain Duties And Responsibilities........................................... 37
Section 802. Certain Notices............................................................... 39
Section 803. Certain Rights of Property Trustee............................................ 39
Section 804. Not Responsible For Recitals or Issuance of Securities........................ 41
Section 805. May Hold Securities........................................................... 41
Section 806. Compensation; Indemnity; Fees................................................. 42
Section 807. Corporate Property Trustee Required; Eligibility of Trustees.................. 43
Section 808. Conflicting Interests......................................................... 43
Section 809. Co-trustees And Separate Trustee.............................................. 43
Section 810. Resignation And Removal; Appointment of Successor............................. 45
Section 811. Acceptance of Appointment by Successor........................................ 46
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Section 812. Merger, Conversion, Consolidation or Succession to Business................... 47
Section 813. Preferential Collection of Claims Against Depositor or Trust.................. 47
Section 814. Reports by Property Trustee................................................... 47
Section 815. Reports to The Property Trustee............................................... 48
Section 816. Evidence of Compliance With Conditions Precedent.............................. 48
Section 817. Number of Trustees............................................................ 48
Section 818. Delegation of Power........................................................... 49
Section 819. Voting........................................................................ 49
ARTICLE IX DISSOLUTION, LIQUIDATION AND MERGER
Section 901. Dissolution Upon Expiration Date.............................................. 49
Section 902. Early Dissolution............................................................. 49
Section 903. Termination................................................................... 50
Section 904. Liquidation................................................................... 50
Section 905. Mergers, Consolidations, Amalgamations or Replacements of The
Trust......................................................................... 52
ARTICLE X MISCELLANEOUS PROVISIONS
Section 1001. Limitation of Rights of Securityholders....................................... 53
Section 1002. Amendment..................................................................... 53
Section 1003. Separability.................................................................. 54
Section 1004. Governing Law................................................................. 54
Section 1005. Payments Due on Non-business Day.............................................. 54
Section 1006. Successors.................................................................... 55
Section 1007. Headings...................................................................... 55
Section 1008. Reports, Notices And Demands.................................................. 55
Section 1009. Agreement Not to Petition..................................................... 55
Section 1010. Trust Indenture Act; Conflict With Trust Indenture Act........................ 56
Section 1011. Acceptance of Terms of Trust Agreement, Guarantee And
Indenture..................................................................... 56
Signatures.................................................................... 57
Exhibit A Certificate of Trust 58
Exhibit B Form of Certificate Depository Agreement 59
Exhibit C Form of Common Securities Certificate 69
Exhibit D Form of Expense Agreement 70
Exhibit E Form of Preferred Securities Certificate 73
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CROSS-REFERENCE TABLE
Section of Section of Amended
Trust Indenture Act and Restated
of 1939, as amended Trust Agreement
------------------- ---------------
<S> <C> <C>
310(a)(1) 807
310(a)(2) 807
310(a)(3) 807
310(a)(4) 207(a)(ii)
310(b) 808
311(a) 813
311(b) 813
312(a) 507
312(b) 507
312(c) 507
313(a) 814(a)
313(a)(4) 814(b)
313(b) 814(b)
313(c) 1008
313(d) 814(c)
314(a) 815
314(b) Not Applicable
314(c)(1) 816
314(c)(2) 816
314(c)(3) Not Applicable
314(d) Not Applicable
314(e) 101,816
315(a) 801(a), 803(a)
315(b) 802, 1008
315(c) 801(a)
315(d) 801, 803
316(a)(2) Not Applicable
316(b) Not Applicable
316(c) 607
317(a)(1) Not Applicable
317(a)(2) Not Applicable
317(b) 509
318(a) 1010
</TABLE>
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<PAGE>
AMENDED AND RESTATED TRUST AGREEMENT
AMENDED AND RESTATED TRUST AGREEMENT, dated as of April __, 1998, among
(i) American Bancorporation, an Ohio corporation (including any successors or
assigns, the "Depositor"), (ii) The Bank of New York, a New York banking
corporation, as property trustee (in such capacity, the "Property Trustee" and,
in its separate corporate capacity and not in its capacity as Property Trustee,
the "Bank"), (iii) The Bank of New York (Delaware), a Delaware banking
corporation, as Delaware Trustee (the "Delaware Trustee"), (iv) Jeremy C.
McCamic, an individual, Paul W. Donahic, an individual, and Brent E. Richmond,
an individual, each of whose address is c/o American Bancorporation, 1025 Main
Street, Suite 800, Wheeling, WV 26003 (each an "Administrative Trustee" and
collectively the "Administrative Trustees") (the Property Trustee, the Delaware
Trustee and the Administrative Trustees referred to collectively as the
"Trustees"), and (v) the several Holders (as hereinafter defined).
RECITALS
WHEREAS, the Depositor and certain of the Trustees have heretofore duly
declared and established a business trust, American Bancorporation Capital Trust
I, pursuant to the Delaware Business Trust Act by the entering into of that
certain Trust Agreement, dated as of March 11, 1998 (the "Original Trust
Agreement"), and by the execution and filing by the Delaware Trustee, the
Property Trustee and the Administrative Trustees with the Secretary of State of
the State of Delaware of the Certificate of Trust, filed on March 11, 1998, the
form of which is attached as Exhibit A; and
WHEREAS, the Depositor and the Trustees desire to amend and restate the
Original Trust Agreement in its entirety as set forth herein to provide for,
among other things, (i) the issuance of the Common Securities (as defined
herein) by the Trust (as defined herein) to the Depositor; (ii) the issuance and
sale of the Preferred Securities (as defined herein) by the Trust pursuant to
the Underwriting Agreement (as defined herein); and (iii) the acquisition by the
Trust from the Depositor of all of the right, title and interest in the
Debentures (as defined herein).
NOW THEREFORE, in consideration of the agreements and obligations set
forth herein and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, each party for the benefit of the
other parties and for the benefit of the Securityholders (as defined herein)
hereby amends and restates the Original Trust Agreement in its entirety and
agrees as follows.
<PAGE>
ARTICLE I
DEFINED TERMS
SECTION 101. DEFINITIONS.
For all purposes of this Trust Agreement, except as otherwise expressly
provided or unless the context otherwise requires:
(a) the terms defined in this Article I have the meanings assigned to
them in this Article I and include the plural as well as the singular;
(b) all other terms used herein that are defined in the Trust Indenture
Act, either directly or by reference therein, have the meanings assigned to them
therein;
(c) unless the context otherwise requires, any reference to an
"Article" or a "Section" refers to an Article or a Section, as the case may be,
of this Trust Agreement; and
(d) the words "herein", "hereof and "hereunder" and other words of
similar import refer to this Trust Agreement as a whole and not to any
particular Article, Section or other subdivision.
"Act" has the meaning specified in Section 608.
"Additional Amount" means, with respect to Trust Securities of a given
Liquidation Amount and/or a given period, the amount of additional interest
accrued on interest in arrears and paid by the Depositor on a Like Amount of
Debentures for such period.
"Additional Interest" has the meaning specified in Section 1.1 of the
Indenture.
"Administrative Trustee" means each of the Persons identified as an
"Administrative Trustee" in the preamble to this Trust Agreement solely in such
Person's capacity as Administrative Trustee of the Trust and not in such
Person's individual capacity, or such Administrative Trustee's successor in
interest in such capacity, or any successor trustee appointed as herein
provided.
"Affiliate" means, with respect to a specified Person, (a) any Person
directly or indirectly owning, controlling or holding with power to vote 10% or
more of the outstanding voting securities or other ownership interests of the
specified Person; (b) any Person 10% or more of whose outstanding voting
securities or other ownership interests are directly or indirectly owned,
controlled or held with power to vote by the specified Person; (c) any Person
directly or indirectly controlling, controlled by, or under common control with
the specified Person; (d) a partnership in which the specified person is a
general partner; (e) any officer or director of the specified Person; and (f) if
the specified Person is an individual, any entity of which the specified Person
is an executive officer, director or general partner.
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"Applicable Procedures" means, with respect to any transfer or
transaction involving a Global Preferred Security or beneficial interest
therein, the rules and procedures of the Depositary for such Preferred Security,
in each case to the extent applicable to such transaction and as in effect from
time to time.
"Bank" has the meaning specified in the Preamble to this Trust
Agreement.
"Bankruptcy Event" means, with respect to any Person:
(a) the entry of a decree or order by a court having jurisdiction in
the premises adjudging such Person a bankrupt or insolvent, or approving as
properly filed a petition seeking liquidation or reorganization of or in respect
of such Person under the United States Bankruptcy Code of 1978, as amended, or
any other similar applicable federal or state law, and the continuance of any
such decree or order unvacated and unstayed for a period of 90 days; or the
commencement of an involuntary case under the United States Bankruptcy Code of
1978, as amended, in respect of such Person, which shall continue undismissed
for a period of 90 days or entry of an order for relief in such case; or the
entry of a decree or order of a court having jurisdiction in the premises for
the appointment on the ground of insolvency or bankruptcy of a receiver,
custodian, liquidator, trustee or assignee in bankruptcy or insolvency of such
Person or of its property, or for the winding up or liquidation of its affairs,
and such decree or order shall have remained in force unvacated and unstayed for
a period of 60 days; or
(b) the institution by such Person of proceedings to be adjudicated a
voluntary bankrupt, or the consent by such Person to the filing of a bankruptcy
proceeding against it, or the filing by such Person of a petition or answer or
consent seeking liquidation or reorganization under the United States Bankruptcy
Code of 1978, as amended, or other similar applicable federal or state law, or
the consent by such Person to the filing of any such petition or to the
appointment on the ground of insolvency or bankruptcy of a receiver or custodian
or liquidator or trustee or assignee in bankruptcy or insolvency of such Person
or of its property, or shall make a general assignment for the benefit of
creditors.
"Bankruptcy Laws" has the meaning specified in Section 1009.
"Board Resolution" means a copy of a resolution certified by the
Secretary or an Assistant Secretary of the Depositor to have been duly adopted
by the Depositor's Board of Directors, or such committee of the Board of
Directors or officers of the Depositor to which authority to act on behalf of
the Board of Directors has been delegated, and to be in full force and effect on
the date of such certification, and delivered to the appropriate Trustee.
"Business Day" means a day other than a Saturday or Sunday, a day on
which banking institutions in the Borough of Manhattan, The City of New York, or
the State of Delaware are authorized or required by law, executive order or
regulation to remain closed, or a day on which the Property Trustee's Corporate
Trust Office or the Corporate Trust Office of the Debenture Trustee is closed
for business.
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<PAGE>
"Capital Treatment Event" has the meaning specified in Section 1.1 of
the Indenture.
"Certificate Depositary Agreement" means the agreement among the Trust,
the Depositor and DTC, as the initial Clearing Agency, dated as of the Closing
Date, substantially in the form attached as Exhibit B, as the same may be
amended and supplemented from time to time.
"Certificate of Trust" means the certificate of trust filed with the
Secretary of State of the State of Delaware with respect to the Trust, as
amended or restated from time to time.
"Change in 1940 Act Law" shall have the meaning set forth in the
definition of "Investment Company Event."
"Clearing Agency" means an organization registered as a "clearing
agency" pursuant to Section 17A of the Exchange Act. DTC shall be the initial
Clearing Agency.
"Clearing Agency Participant" means a broker, dealer, bank, other
financial institution or other Person for whom from time to time the Clearing
Agency effects book-entry transfers and pledges of securities deposited with the
Clearing Agency.
"Closing Date" means the date of execution and delivery of this Trust
Agreement.
"Code" means the Internal Revenue Code of 1986, or any successor
statute, in each case as amended from time to time.
"Commission" means the Securities and Exchange Commission, as from time
to time constituted, created under the Exchange Act, or, if at any time after
the execution of this Trust Agreement such Commission is not existing and
performing the duties now assigned to it under the Trust Indenture Act, then the
body performing such duties at such time.
"Common Security" means an undivided beneficial interest in the assets
of the Trust, having a Liquidation Amount of $10 and having the rights provided
therefor in this Trust Agreement, including the right to receive Distributions
and a Liquidation Distribution as provided herein. Common Securities rank pari
passu with the Preferred Securities; provided, however, that upon the occurrence
of an Event of Default, the right of holders of Common Securities to payment in
respect of (i) Distributions, and (ii) payments upon liquidation, redemption and
otherwise are subordinated to the right of holders of Preferred Securities.
"Common Securities Certificate" means a certificate evidencing
ownership of Common Securities, substantially in the form attached as Exhibit C.
"Corporate Trust Office" means (i) when used with respect to the
Property Trustee, the principal corporate trust office of the Property Trustee
located in New York, New York, and (ii) when used with respect to the Debenture
Trustee, the principal corporate trust office of the Debenture Trustee located
in New York, New York.
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<PAGE>
"Debenture Event of Default" means an "Event of Default" as defined in
Section 7.1 of the Indenture.
"Debenture Redemption Date" means, with respect to any Debentures to be
redeemed under the Indenture, the date fixed for redemption under the Indenture.
"Debenture Tax Event" means a "Tax Event" as specified in Section 1.1
of the Indenture.
"Debenture Trustee" means The Bank of New York, a banking corporation
organized under the laws of the State of New York, and any successor thereto, as
trustee under the Indenture.
"Debentures" means the aggregate principal amount of the Depositor's
_____% Junior Subordinated Deferrable Interest Debentures due 2028, issued
pursuant to the Indenture.
"Definitive Preferred Securities Certificates" means the Preferred
Securities Certificates issued in certificated, fully registered form
(non-global) as provided in Section 503.
"Delaware Business Trust Act" means Chapter 38 of Title 12 of the
Delaware Code, 12 Delaware Code Sections 3801 et seq. as it may be amended from
time to time.
"Delaware Trustee" means the Person identified as the "Delaware
Trustee" in the preamble to this Trust Agreement solely in its capacity as
Delaware Trustee of the Trust and not in its individual capacity, or its
successor in interest in such capacity, or any successor Trustee appointed as
herein provided.
"Depositor" has the meaning specified in the Preamble to this Trust
Agreement.
"Depositary" means with respect any Global Preferred Security issuable
or issued in whole or in part in the form of one or more Global Preferred
Security, the Person designated as Depositary by the Depositor.
"Distribution Date" has the meaning specified in Section 401(a).
"Distributions" means amounts payable in respect of the Trust
Securities as provided in Section 401(b).
"DTC" means The Depository Trust Company.
"Event of Default" means any one of the following events (whatever the
reason for such Event of Default and whether it shall be voluntary or
involuntary or be effected by operation of law or pursuant to any judgment,
decree or order of any court or any order, rule or regulation of any
administrative or governmental body):
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(a) the occurrence of a Debenture Event of Default; or
(b) default by the Trust or the Property Trustee in the payment of any
Distribution when it becomes due and payable, and continuation of such default
for a period of 30 days; or
(c) default by the Trust or the Property Trustee in the payment of any
Redemption Price of any Trust Security when it becomes due and payable; or
(d) default in the performance, or breach, in any material respect, of
any covenant or warranty of the Trustees in this Trust Agreement (other than a
covenant or warranty a default in the performance of which or the breach of
which is dealt with in clause (b) or (c), above) and continuation of such
default or breach for a period of 60 days after there has been given, by
registered or certified mail, to the defaulting Trustee or Trustees by the
Holders of at least 25% in aggregate liquidation preference of the Outstanding
Preferred Securities a written notice specifying such default or breach and
requiring it to be remedied and stating that such notice is a "Notice of
Default" hereunder; or
(e) the occurrence of a Bankruptcy Event with respect to the Property
Trustee and the failure by the Depositor to appoint a successor Property Trustee
within 60 days thereof.
"Exchange Act" means the Securities Exchange Act of 1934, or any
successor statute, in each case as amended from time to time.
"Expense Agreement" means the Agreement as to Expenses and Liabilities
between the Depositor and the Trust, substantially in the form attached as
Exhibit D, as amended from time to time.
"Expiration Date" has the meaning specified in Section 901.
"Extended Interest Payment Period" has the meaning specified in Section
4.1 of the Indenture.
"Global Preferred Securities Certificate" means a Preferred Securities
Certificate evidencing ownership of Global Preferred Securities.
"Global Preferred Security" means a Preferred Security, the ownership
and transfers of which shall be made through book entries by a Clearing Agency
as described in Section 503a.
"Guarantee" means the Preferred Securities Guarantee Agreement executed
and delivered by the Depositor, as guarantor, and The Bank of New York, as
Preferred Guarantee Trustee, contemporaneously with the execution and delivery
of this Trust Agreement, for the benefit of the Holders of the Preferred
Securities, as amended from time to time.
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<PAGE>
"Indenture" means the Indenture, dated as of April __, 1998 between the
Depositor and the Debenture Trustee, as trustee, as amended or supplemented from
time to time.
"Investment Company Act" means the Investment Company Act of 1940, or
any successor statute, in each case as amended from time to time.
"Investment Company Event" has the meaning specified in Section 1.1 of
the Indenture.
"Lien" means any lien, pledge, charge, encumbrance, mortgage, deed of
trust, adverse ownership interest, hypothecation, assignment, security interest
or preference, priority or other security agreement or preferential arrangement
of any kind or nature whatsoever.
"Like Amount" means (a) with respect to a redemption of Trust
Securities, Trust Securities having a Liquidation Amount equal to the principal
amount of Debentures to be contemporaneously redeemed in accordance with the
Indenture and the proceeds of which shall be used to pay the Redemption Price of
such Trust Securities; and (b) with respect to a distribution of Debentures to
Holders of Trust Securities in connection with a dissolution and liquidation of
the Trust, Debentures having a principal amount equal to the Liquidation Amount
of the Trust Securities of the Holder to whom such Debentures are distributed.
Each Debenture distributed pursuant to clause (b) above shall carry with it
accumulated interest in an amount equal to the accumulated and unpaid interest
then due on such Debentures.
"Liquidation Amount" means the stated amount of $10 per Trust Security.
"Liquidation Date" means the date on which Debentures are to be
distributed to Holders of Trust Securities in connection with a dissolution and
liquidation of the Trust pursuant to Section 904(a).
"Liquidation Distribution" has the meaning specified in Section 904(d).
"Officers' Certificate" means a certificate signed by the Chairman of
the Board, Chief Executive Officer, President or a Vice President and by the
Chief Financial Officer, the Treasurer or an Assistant Treasurer or the
Controller or an Assistant Controller or the Secretary or an Assistant
Secretary, of the Depositor, and delivered to the appropriate Trustee. One of
the officers signing an Officers' Certificate given pursuant to Section 816
shall be the principal executive, financial or accounting officer of the
Depositor. Any Officers' Certificate delivered with respect to compliance with a
condition or covenant provided for in this Trust Agreement shall include:
(a) a statement that each officer signing the Officers' Certificate has
read the covenant or condition and the definitions relating thereto;
(b) a brief statement of the nature and scope of the examination or
investigation undertaken by each officer in rendering the Officers' Certificate;
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<PAGE>
(c) a statement that each such officer has made such examination or
investigation as, in such officer's opinion, is necessary to enable such officer
to express an informed opinion as to whether or not such covenant or condition
has been complied with; and
(d) a statement as to whether, in the opinion of each such officer,
such condition or covenant has been complied with.
"Opinion of Counsel" means an opinion in writing of legal counsel, who
may be counsel for the Trust, the Property Trustee, or the Depositor, but not an
employee of any thereof, and who shall be reasonably acceptable to the Property
Trustee.
"Original Trust Agreement" has the meaning specified in the Recitals to
this Trust Agreement.
"Outstanding", when used with respect to Preferred Securities, means,
as of the date of determination, all Preferred Securities theretofore executed
and delivered under this Trust Agreement, except:
(a) Preferred Securities theretofore canceled by the Property Trustee
or delivered to the Property Trustee for cancellation;
(b) Preferred Securities for whose payment or redemption money in the
necessary amount has been theretofore deposited with the Property Trustee or any
Paying Agent for the Holders of such Preferred Securities; provided that, if
such Preferred Securities are to be redeemed, notice of such redemption has been
duly given pursuant to this Trust Agreement; and
(c) Preferred Securities which have been paid or in exchange for or in
lieu of which other Preferred Securities have been executed and delivered
pursuant to Sections 504, 505 and 511a; provided, however, that in determining
whether the Holders of the requisite Liquidation Amount of the Outstanding
Preferred Securities have given any request, demand, authorization, direction,
notice, consent or waiver hereunder, Preferred Securities owned by the
Depositor, any Trustee or any Affiliate of the Depositor or any Trustee shall be
disregarded and deemed not to be Outstanding, except that (a) in determining
whether any Trustee shall be protected in relying upon any such request, demand,
authorization, direction, notice, consent or waiver, only Preferred Securities
that such Trustee actually knows to be so owned shall be so disregarded and (b)
the foregoing shall not apply at any time when all of the outstanding Preferred
Securities are owned by the Depositor, one or more of the Trustees and/or any
such Affiliate. Preferred Securities so owned which have been pledged in good
faith may be regarded as Outstanding if the pledgee establishes to the
satisfaction of the Administrative Trustees the pledgee's right so to act with
respect to such Preferred Securities and that the pledgee is not the Depositor
or any Affiliate of the Depositor.
"Owners" means each Person who is the beneficial owner of a beneficial
interest in a Global Preferred Security as reflected in the records of the
Clearing Agency or, if a Clearing
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<PAGE>
Agency Participant is not the Owner, then as reflected in the records of a
Person maintaining an account with such Clearing Agency (directly or indirectly,
in accordance with the rules of such Clearing Agency).
"Paying Agent" means any paying agent or co-paying agent appointed
pursuant to Section 509 and shall initially be the Bank.
"Payment Account" means a segregated non-interest-bearing corporate
trust account maintained by the Property Trustee with the Bank in its trust
department for the benefit of the Securityholders in which all amounts paid in
respect of the Debentures shall be held and from which the Property Trustee
shall make payments to the Securityholders in accordance with Sections 401 and
402.
"Person" means any individual, corporation, partnership, joint venture,
trust, limited liability company or corporation, unincorporated organization or
government or any agency or political subdivision thereof.
"Preferred Security" means an undivided beneficial interest in the
assets of the Trust, having a Liquidation Amount of $10 and having the rights
provided therefor in this Trust Agreement, including the right to receive
Distributions and a Liquidation Distribution as provided herein.
"Preferred Securities Certificate", means a certificate evidencing
ownership of Preferred Securities, substantially in the form attached as Exhibit
E.
"Property Trustee" means the Person identified as the "Property
Trustee," in the Preamble to this Trust Agreement solely in its capacity as
Property Trustee of the Trust and not in its individual capacity, or its
successor in interest in such capacity, or any successor property trustee
appointed as herein provided.
"Redemption Date" means, with respect to any Trust Security to be
redeemed, the date fixed for such redemption by or pursuant to this Trust
Agreement; provided that each Debenture Redemption Date and the stated maturity
of the Debentures shall be a Redemption Date for a Like Amount of Trust
Securities.
"Redemption Price" means, with respect to any Trust Security, the
Liquidation Amount of such Trust Security, plus accumulated and unpaid
Distributions to the Redemption Date, paid by the Depositor upon the concurrent
redemption of a Like Amount of Debentures, allocated on a pro rata basis (based
on Liquidation Amounts) among the Trust Securities.
"Relevant Trustee" shall have the meaning specified in Section 810.
"Securities Register" and "Securities Registrar" have the respective
meanings specified in Section 504.
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<PAGE>
"Securityholder" or "Holder" means a Person in whose name a Trust
Security or Securities is registered in the Securities Register; any such Person
is a beneficial owner within the meaning of the Delaware Business Trust Act.
"Trust" means American Bancorporation Capital Trust I, a Delaware
business trust created and continued hereby.
"Trust Agreement" means this Amended and Restated Trust Agreement, as
the same may be modified, amended or supplemented in accordance with the
applicable provisions hereof, including all exhibits hereto, including, for all
purposes of this Trust Agreement and any such modification, amendment or
supplement, the provisions of the Trust Indenture Act that are deemed to be a
part of and govern this Trust Agreement and any such modification, amendment or
supplement, respectively.
"Trust Indenture Act" means the Trust Indenture Act of 1939, as
amended, as in force at the date as of which this instrument was executed;
provided, however, that in the event the Trust Indenture Act of 1939, as
amended, is amended after such date, "Trust Indenture Act" means, to the extent
required by any such amendment, the Trust Indenture Act of 1939 as so amended.
"Trust Property" means (a) the Debentures; (b) any cash on deposit in,
or owing to, the Payment Account; and (c) all proceeds and rights in respect of
the foregoing and any other property and assets for the time being held or
deemed to be held by the Property Trustee pursuant to the trusts of this Trust
Agreement.
"Trust Security" means any one of the Common Securities or the
Preferred Securities.
"Trust Securities Certificate" means any one of the Common Securities
Certificates or the Preferred Securities Certificates.
"Trustees" means, collectively, the Property Trustee, the Delaware
Trustee and the Administrative Trustees.
"Underwriting Agreement" means the Underwriting Agreement, dated as of
April ___, 1998, including exhibits, among the Trust, the Depositor and the
Underwriter named therein.
ARTICLE II
ESTABLISHMENT OF THE TRUST
SECTION 201. NAME.
The Trust created and continued hereby shall be known as "American
Bancorporation Capital Trust I," as such name may be modified from time to time
by the Administrative Trustees following written notice to the Holders of Trust
Securities and the other Trustees, in which name
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the Trustees may engage in the transactions contemplated hereby, make and
execute contracts and other instruments on behalf of the Trust and sue and be
sued.
SECTION 202. OFFICE OF THE DELAWARE TRUSTEE; PRINCIPAL PLACE OF BUSINESS.
The address of the Delaware Trustee in the State of Delaware is c/o The
Bank of New York (Delaware), White Clay Center, Route 273, Newark, Delaware
19711, Attention: Corporate Trust Department, or such other address in the State
of Delaware as the Delaware Trustee may designate by written notice to the
Securityholders and the Depositor. The principal executive office of the Trust
is c/o American Bancorporation, 1025 Main Street, Suite 800, Wheeling, WV 26003,
Attention: Corporate Secretary.
SECTION 203. INITIAL CONTRIBUTION OF TRUST PROPERTY; ORGANIZATIONAL EXPENSES.
The Trustees acknowledge receipt in trust from the Depositor in
connection with the Original Trust Agreement of the sum of $10.00, which
constituted the initial Trust Property. The Depositor shall pay organizational
expenses of the Trust as they arise or shall, upon request of any Trustee,
promptly reimburse such Trustee for any such expenses paid by such Trustee. The
Depositor shall make no claim upon the Trust Property for the payment of such
expenses.
SECTION 204. ISSUANCE OF THE PREFERRED SECURITIES.
The Depositor on behalf of the Trust and pursuant to the Original Trust
Agreement, executed and delivered the Underwriting Agreement. Contemporaneously
with the execution and delivery of this Trust Agreement, an Administrative
Trustee, on behalf of the Trust, shall execute in accordance with Section 502
and deliver in accordance with the Underwriting Agreement, Preferred Securities
Certificates, registered in the name of the Persons entitled thereto, in an
aggregate amount of _________ Preferred Securities having an aggregate
Liquidation Amount of $__________ against receipt of the aggregate purchase
price of such Preferred Securities of $__________, which amount such
Administrative Trustee shall promptly deliver to the Property Trustee. If the
underwriters exercise their Option and there is an Option Closing Date (as such
terms are defined in the Underwriting Agreement), then an Administrative
Trustee, on behalf of the Trust, shall execute in accordance with Section 502
and deliver in accordance with the Underwriting Agreement, additional Preferred
Securities Certificates, registered in the name of the Persons entitled thereto,
in an aggregate amount of up to _______ Preferred Securities having an aggregate
Liquidation Amount of up to $_________ against receipt of the aggregate purchase
price of such Preferred Securities of $_________, which amount such
Administrative Trustee shall promptly deliver to the Property Trustee.
SECTION 205. ISSUANCE OF THE COMMON SECURITIES; SUBSCRIPTION AND PURCHASE OF
DEBENTURES.
(a) Contemporaneously with the execution and delivery of this Trust
Agreement, an Administrative Trustee, on behalf of the Trust, shall execute in
accordance with Section 502 and deliver to the Depositor, Common Securities
Certificates, registered in the name of the Depositor
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in an aggregate amount of Common Securities having an aggregate Liquidation
Amount of $_______ against payment by the Depositor of such amount, which amount
such Administrative Trustee shall promptly deliver to the Property Trustee.
Contemporaneously therewith, an Administrative Trustee on behalf of the Trust,
shall subscribe to and purchase from the Depositor corresponding amounts of
Debentures, registered in the name of the Property Trustee on behalf of the
Trust and having an aggregate principal amount equal to $__________ (being the
sum of the amounts delivered to the Property Trustee pursuant to (i) the second
sentence of Section 204; and (ii) the first sentence of Section 205(a)), and, in
satisfaction of the purchase price for such Debentures, the Property Trustee, on
behalf of the Trust, shall deliver to the Depositor the sum of $__________.
(b) If the underwriters exercise the Option and there is an Option
Closing Date (as such terms are defined in the Underwriting Agreement), then an
Administrative Trustee, on behalf of the Trust, shall execute in accordance with
Section 502 and deliver to the Depositor, Common Securities Certificates,
registered in the name of the Depositor, in an aggregate amount of Common
Securities having an aggregate Liquidation Amount of up to $_______ against
payment by the Depositor of such amount. Contemporaneously therewith, an
Administrative Trustee, on behalf of the Trust, shall subscribe to and purchase
from the Depositor corresponding amounts of Debentures, registered in the name
of the Trust and having an aggregate principal amount of up to $_______, and, in
satisfaction of the purchase price of such Debentures, the Property Trustee, on
behalf of the Trust, shall deliver to the Depositor the amount received from one
of the Administrative Trustees pursuant to the last sentence of Section 204
(being the sum of the amounts delivered to the Property Trustee pursuant to (i)
the third sentence of Section 204; and (ii) the first sentence of this Section
205(b)).
SECTION 206. DECLARATION OF TRUST.
The exclusive purposes and functions of the Trust are (a) to issue and
sell Trust Securities and use the proceeds from such sale to acquire the
Debentures; and (b) to engage in those activities necessary, convenient or
incidental thereto. The Depositor hereby appoints the Trustees as trustees of
the Trust, to have all the rights, powers and duties to the extent set forth
herein, and the Trustees hereby accept such appointment. The Property Trustee
hereby declares that it shall hold the Trust Property in trust upon and subject
to the conditions set forth herein for the benefit of the Securityholders. The
Administrative Trustees shall have all rights, powers and duties set forth
herein and in accordance with applicable law with respect to accomplishing the
purposes of the Trust. The Delaware Trustee shall be one of the Trustees of the
Trust for the sole and limited purpose of fulfilling the requirements of Section
3807 of the Delaware Business Trust Act.
SECTION 207. AUTHORIZATION TO ENTER INTO CERTAIN TRANSACTIONS.
(a) The Trustees shall conduct the affairs of the Trust in accordance
with the terms of this Trust Agreement. Subject to the limitations set forth in
paragraph (b) of this Section 207 and Article VIII, and in accordance with the
following provisions (i) and (ii), the Administrative
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Trustees shall have the authority to enter into all transactions and agreements
determined by the Administrative Trustees to be appropriate in exercising the
authority, express or implied, otherwise granted to the Administrative Trustees
under this Trust Agreement, and to perform all acts in furtherance thereof,
including without limitation, the following:
(i) As among the Trustees, each Administrative Trustee,
acting singly or collectively, shall have the power and authority to
act on behalf of the Trust with respect to the following matters:
(A) the issuance and sale of the Trust Securities;
(B) to cause the Trust to enter into, and to execute,
deliver and perform on behalf of the Trust, the Expense
Agreement, Certificate Depositary Agreement and such other
agreements or documents as may be necessary or desirable in
connection with the purposes and function of the Trust;
(C) assisting in the registration of the Preferred
Securities under the Securities Act of 1933, as amended, and
under state securities or blue sky laws, and the
qualification of this Trust Agreement as a trust indenture
under the Trust Indenture Act;
(D) assisting in the listing of the Preferred
Securities upon The Nasdaq Stock Market's National Market or
such securities exchange or exchanges as shall be determined
by the Depositor and the registration of the Preferred
Securities under the Exchange Act, and the preparation and
filing of all periodic and other reports and other documents
pursuant to the foregoing;
(E) the sending of notices (other than notices of
default) and other information regarding the Trust
Securities and the Debentures to the Securityholders in
accordance with this Trust Agreement;
(F) the appointment of a Paying Agent, authenticating
agent and Securities Registrar in accordance with this Trust
Agreement;
(G) to the extent provided in this Trust Agreement,
the winding up of the affairs of and liquidation of the
Trust and the preparation, execution and filing of the
certificate of cancellation with the Secretary of State of
the State of Delaware;
(H) to take all action that may be necessary or
appropriate for the preservation and the continuation of the
Trust's valid existence, rights, franchises and privileges
as a statutory business trust under the laws of the State of
Delaware and of each other jurisdiction in which such
existence is necessary to
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protect the limited liability of the Holders of the
Preferred Securities or to enable the Trust to effect the
purposes for which the Trust was created;
(I) assisting in the registration or listing of the
Preferred Securities with DTC or upon such other trading
facilities or exchanges as shall be determined by the
Depositor and the preparation and filing of all periodic and
other reports and other documents pursuant to the foregoing;
and
(J) the taking of any action incidental to the
foregoing as the Administrative Trustees may from time to
time determine is necessary or advisable to give effect to
the terms of this Trust Agreement for the benefit of the
Securityholders (without consideration of the effect of any
such action on any particular Securityholder).
(ii) As among the Trustees, the Property Trustee shall have
the power, duty and authority to act on behalf of the Trust with
respect to the following matters:
(A) the establishment of the Payment Account;
(B) the receipt of the Debentures;
(C) the collection of interest, principal and any
other payments made in respect of the Debentures in the
Payment Account;
(D) the distribution of amounts owed to the
Securityholders in respect of the Trust Securities in
accordance with the terms of this Trust Agreement;
(E) the exercise of all of the rights, powers and
privileges of a holder of the Debentures;
(F) the sending of notices of default and other
information regarding the Trust Securities and the
Debentures to the Securityholders in accordance with this
Trust Agreement;
(G) the distribution of the Trust Property in
accordance with the terms of this Trust Agreement;
(H) to the extent provided in this Trust Agreement,
the winding up of the affairs of and liquidation of the
Trust and the execution of the certificate of cancellation
with the Secretary of State of the State of Delaware;
(I) after an Event of Default, the taking of any
action incidental to the foregoing as the Property Trustee
may from time to time determine is necessary or advisable to
give effect to the terms of this Trust Agreement and protect
and
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conserve the Trust Property for the benefit of the
Securityholders (without consideration of the effect of any
such action on any particular Securityholder);
(J) registering transfers of the Trust Securities in
accordance with this Trust Agreement; and
(K) except as otherwise provided in this Section
207(a)(ii), the Property Trustee shall have none of the
duties, liabilities, powers or the authority of the
Administrative Trustees set forth in Section 207(a)(i).
(b) So long as this Trust Agreement remains in effect, the Trust (or
the Trustees acting on behalf of the Trust) shall not undertake any business,
activities or transaction except as expressly provided herein or contemplated
hereby. In particular, the Trustees shall not (i) acquire any investments or
engage in any activities not authorized by this Trust Agreement; (ii) sell,
assign, transfer, exchange, mortgage, pledge, setoff or otherwise dispose of any
of the Trust Property or interests therein, including to Securityholders, except
as expressly provided herein; (iii) take any action that would cause the Trust
to fail or cease to qualify as a "grantor trust" for United States federal
income tax purposes; (iv) incur any indebtedness for borrowed money or issue any
other debt; or (v) take or consent to any action that would result in the
placement of a Lien on any of the Trust Property. The Administrative Trustees
shall defend all claims and demands of all Persons at any time claiming any Lien
on any of the Trust Property adverse to the interest of the Trust or the
Securityholders in their capacity as Securityholders.
(c) In connection with the issuance and sale of the Preferred
Securities, the Depositor shall have the right and responsibility to assist the
Trust with respect to, or effect on behalf of the Trust, the following (and any
actions taken by the Depositor in furtherance of the following prior to the date
of this Trust Agreement are hereby ratified and confirmed in all respects):
(i) the preparation and filing by the Trust with the
Commission and the execution on behalf of the Trust of a registration
statement on the appropriate form in relation to the Preferred
Securities and the Debentures, including any amendments thereto;
(ii) the determination of the states in which to take
appropriate action to qualify or, register for sale all or part of the
Preferred Securities and to do any and all such acts, other than
actions which must be taken by or on behalf of the Trust, and advise
the Trustees of actions they must take on behalf of the Trust, and
prepare for execution and filing any documents to be executed and filed
by the Trust or on behalf of the Trust, as the Depositor deems
necessary or advisable in order to comply with the applicable laws of
any such States;
(iii) the preparation for filing by the Trust and execution
on behalf of the Trust of an application to The Nasdaq Stock Market's
National Market or a national stock exchange or other organizations for
listing upon notice of issuance of any Preferred Securities and to file
or cause an Administrative Trustee to file thereafter with such
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exchange or organization such notifications and documents as may be
necessary from time to time;
(iv) the preparation for filing by the Trust with the
Commission and the execution on behalf of the Trust of a registration
statement on Form 8-A relating to the registration of the Preferred
Securities under Section 12(b) or 12(g) of the Exchange Act, including
any amendments thereto;
(v) the negotiation of the terms of, and the execution and
delivery of, the Underwriting Agreement providing for the sale of the
Preferred Securities; and
(vi) the taking of any other actions necessary or desirable
to carry out any of the foregoing activities.
(d) Notwithstanding anything herein to the contrary, the Administrative
Trustees are authorized and directed to conduct the affairs of the Trust and to
operate the Trust so that the Trust shall not be deemed to be an "investment
company" required to be registered under the Investment Company Act, shall be
classified as a "grantor trust" and not as an association taxable as a
corporation for United States federal income tax purposes and so that the
Debentures shall be treated as indebtedness of the Depositor for United States
federal income tax purposes. In this connection, subject to Section 1002, the
Depositor and the Administrative Trustees are authorized to take any action, not
inconsistent with applicable law or this Trust Agreement, that each of the
Depositor and the Administrative Trustees determines in their discretion to be
necessary or desirable for such purposes.
SECTION 208. ASSETS OF TRUST.
The assets of the Trust shall consist of the Trust Property.
SECTION 209. TITLE TO TRUST PROPERTY.
Legal title to all Trust Property shall be vested at all times in the
Property Trustee (in its capacity as such) and shall be held and administered by
the Property Trustee for the benefit of the Securityholders in accordance with
this Trust Agreement.
ARTICLE III
PAYMENT ACCOUNT
SECTION 301. PAYMENT ACCOUNT.
(a) On or prior to the Closing Date, the Property Trustee shall
establish the Payment Account. The Property Trustee and any agent of the
Property Trustee shall have exclusive control and sole right of withdrawal with
respect to the Payment Account for the purpose of making
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deposits and withdrawals from the Payment Account in accordance with this Trust
Agreement. All monies and other property deposited or held from time to time in
the Payment Account shall be held by the Property Trustee in the Payment Account
for the exclusive benefit of the Securityholders and for distribution as herein
provided, including (and subject to) any priority of payments provided for
herein.
(b) The Property Trustee shall deposit in the Payment Account, promptly
upon receipt, all payments of principal of or interest on, and any other
payments or proceeds with respect to, the Debentures. Amounts held in the
Payment Account shall not be invested by the Property Trustee pending
distribution thereof.
ARTICLE IV
DISTRIBUTIONS; REDEMPTION
SECTION 401. DISTRIBUTIONS.
The Trust Securities represent undivided beneficial interests in the
Trust Property, and Distributions (including Additional Amounts) will be made on
the Trust Securities at the rate and on the dates that payments of interest
(including of Additional Interest, as defined in the Indenture) are made on the
Debentures. Accordingly:
(a) Distributions on the Trust Securities shall be cumulative, and
shall accumulate whether or not there are funds of the Trust available for the
payment of Distributions. Distributions shall accumulate from April __, 1998,
and, except during any Extended Interest Payment Period with respect to the
Debentures, shall be payable quarterly in arrears on March 1, June 1, September
1 and December 1 each year, commencing on June 1, 1998. If any date on which a
Distribution is otherwise payable on the Trust Securities is not a Business Day,
then the payment of such Distribution shall be made on the next succeeding day
that is a Business Day (and without any interest or other payment in respect of
any such delay) except that, if such Business Day is in the next succeeding
calendar year, payment of such Distribution shall be made on the immediately
preceding Business Day, in each case with the same force and effect as if made
on such date (each date on which distributions are payable in accordance with
this Section 401(a), a "Distribution Date").
(b) Assuming payments of interest on the Debentures are made when due
(and before giving effect to Additional Amounts, if applicable), Distributions
on the Trust Securities shall be payable at a rate of _____% per annum of the
Liquidation Amount of the Trust Securities. The amount of Distributions payable
for any full period shall be computed on the basis of a 360 day year of twelve
30-day months. The amount of Distributions for any partial period shall be
computed on the basis of the number of days elapsed in a 360 day year of twelve
30 day months. During any Extended Interest Payment Period with respect to the
Debentures, Distributions on the Preferred Securities shall be deferred for a
period equal to the Extended Interest Payment
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Period. The amount of Distributions payable for any period shall include the
Additional Amounts, if any.
(c) Distributions on the Trust Securities shall be made by the Property
Trustee solely from the Payment Account and shall be payable on each
Distribution Date only to the extent that the Trust has funds then on hand and
immediately available in the Payment Account for the payment of such
Distributions.
(d) Distributions on the Trust Securities with respect to a
Distribution Date shall be payable to the Holders thereof as they appear on the
Securities Register for the Trust Securities on the relevant record date, which
shall be 15th day of the preceding month in which the Distribution is payable.
SECTION 402. REDEMPTION.
(a) On each Debenture Redemption Date and on the stated maturity of the
Debentures the Trust shall be required to redeem a Like Amount of Trust
Securities at the Redemption Price.
(b) Notice of redemption shall be given by the Property Trustee in the
name of and at the expense of the Trust by first-class mail, postage prepaid,
mailed not less than 30 nor more than 60 days prior to the Redemption Date to
each Holder of Trust Securities to be redeemed, at such Holder's address
appearing in the Securities Register. The Property Trustee shall have no
responsibility for the accuracy of any CUSIP number contained in such notice.
All notices of redemption shall state:
(i) the Redemption Date;
(ii) the Redemption Price;
(iii) the CUSIP number;
(iv) if less than all the Outstanding Trust Securities are
to be redeemed, the identification and the aggregate Liquidation Amount
of the particular Trust Securities to be redeemed;
(v) that, on the Redemption Date, the Redemption Price shall
become due and payable upon each such Trust Security to be redeemed and
that Distributions thereon shall cease to accumulate on and after said
date with respect to each such Trust Security; and
(vi) the place or places where the Trust Securities are to
be surrendered for the payment of the Redemption Price.
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(c) The Trust Securities redeemed on each Redemption Date shall be
redeemed at the Redemption Price with the proceeds from the contemporaneous
redemption of Debentures. Redemptions of the Trust Securities shall be made and
the Redemption Price shall be payable on each Redemption Date only to the extent
that the Trust has immediately available funds then on hand and available in the
Payment Account for the payment of such Redemption Price.
(d) If the Property Trustee gives a notice of redemption in respect of
any Preferred Securities, then, by 12:00 p.m., New York City time, on the
Redemption Date, subject to Section 402(c), the Property Trustee will, so long
as the Preferred Securities are in book-entry-only form, irrevocably deposit
with the Clearing Agency for the Preferred Securities funds sufficient to pay
the applicable Redemption Price and will give such Clearing Agency irrevocable
instructions and authority to pay the Redemption Price to the Holders thereof.
If the Preferred Securities are no longer in book-entry-only form, the Property
Trustee, subject to Section 402(c), will provide the Paying Agent with
irrevocable instructions and authority to pay the Redemption Price to the
Holders thereof upon surrender of their Preferred Securities Certificates.
Notwithstanding the foregoing, Distributions payable on or prior to the
Redemption Date for any Trust Securities called for redemption shall be payable
to the Holders of such Trust Securities as they appear on the Securities
Register for the Trust Securities on the relevant record dates for the related
Distribution Dates. If notice of redemption shall have been given and funds
deposited as required, then upon the date of such deposit, all rights of
Securityholders holding Trust Securities so called for redemption shall cease,
except the right of such Securityholders to receive the Redemption Price and any
Distribution payable on or prior to the Redemption Date, but without interest,
and such Trust Securities shall cease to be Outstanding. In the event that any
date on which any Redemption Price is payable is not a Business Day, then
payment of the Redemption Price payable on such date shall be made on the next
succeeding day that is a Business Day (and without any interest or other payment
in respect of any such delay), except that, if such Business Day falls in the
next calendar year, such payment shall be made on the immediately preceding
Business Day, in each case, with the same force and effect as if made on such
date. In the event that payment of the Redemption Price in respect of any Trust
Securities called for redemption is improperly withheld or refused and not paid
either by the Trust or by the Depositor pursuant to the Guarantee, Distributions
on such Trust Securities shall continue to accumulate, at the then applicable
rate, from the Redemption Date originally established by the Trust for such
Trust Securities to the date such Redemption Price is actually paid, in which
case the actual payment date shall be the date fixed for redemption for purposes
of calculating the Redemption Price.
(e) Payment of the Redemption Price on the Trust Securities shall be
made to the record Holders thereof as they appear on the Securities Register for
the Trust Securities on the relevant record date, which shall be one Business
Day prior to the relevant Redemption Date; provided, however, in the event that
the Preferred Securities do not remain in book-entry form, the relevant record
date shall be the date 15 days prior to the relevant Redemption Date.
(f) Subject to Section 403(a), if less than all the Outstanding Trust
Securities are to be redeemed on a Redemption Date, then the aggregate
Liquidation Amount of Trust Securities to be redeemed shall be allocated on a
pro rata basis (based on Liquidation Amounts) among the
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Common Securities and the Preferred Securities. The particular Preferred
Securities to be redeemed shall be selected not more than 60 days prior to the
Redemption Date by the Property Trustee from the Outstanding Preferred
Securities not previously called for redemption, by such method (including,
without limitation, by lot) as the Property Trustee shall deem fair and
appropriate and which may provide for the selection for redemption of portions
(equal to $10 or an integral multiple of $10 in excess thereof), of the
Liquidation Amount of Preferred Securities of a denomination larger than $10.
The Property Trustee shall promptly notify the Securities Registrar in writing
of the Preferred Securities selected for redemption and, in the case of any
Preferred Securities selected for partial redemption, the Liquidation Amount
thereof to be redeemed. For all purposes of this Trust Agreement, unless the
context otherwise requires, all provisions relating to the redemption of
Preferred Securities shall relate, in the case of any Preferred Securities
redeemed or to be redeemed only in part, to the portion of the Liquidation
Amount of Preferred Securities which has been or is to be redeemed.
SECTION 403. SUBORDINATION OF COMMON SECURITIES.
(a) Payment of Distributions (including Additional Amounts, if
applicable) on, and the Redemption Price of, the Trust Securities, as
applicable, shall be made, subject to Section 402(f), pro rata among the Common
Securities and the Preferred Securities based on the Liquidation Amount of the
Trust Securities, provided, however, that if on any Distribution Date or
Redemption Date any Event of Default resulting from a Debenture Event of Default
shall have occurred and be continuing, no payment of any Distribution (including
Additional Amounts, if applicable) on, or Redemption Price of, any Common
Security, and no other payment on account of the redemption, liquidation or
other acquisition of Common Securities, shall be made unless payment in full in
cash of all accumulated and unpaid Distributions (including Additional Amounts,
if applicable) on all Outstanding Preferred Securities for all Distribution
periods terminating on or prior thereto, or in the case of payment of the
Redemption Price the full amount of such Redemption Price on all Outstanding
Preferred Securities then called for redemption, shall have been made or
provided for, and all funds immediately available to the Property Trustee shall
first be applied to the payment in full in cash of all Distributions (including
Additional Amounts, if applicable) on, or the Redemption Price of, Preferred
Securities then due and payable.
(b) In the case of the occurrence of any Event of Default resulting
from a Debenture Event of Default, the Holder of Common Securities shall be
deemed to have waived any right to act with respect to any such Event of Default
under this Trust Agreement until the effect of all such Events of Default with
respect to the Preferred Securities shall have been cured, waived or otherwise
eliminated. Until any such Event of Default under this Trust Agreement with
respect to the Preferred Securities shall have been so cured, waived or
otherwise eliminated, the Property Trustee shall act solely on behalf of the
Holders of the Preferred Securities and not the Holder of the Common Securities,
and only the Holders of the Preferred Securities shall have the right to direct
the Property Trustee to act on their behalf.
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SECTION 404. PAYMENT PROCEDURES.
Payments of Distributions (including Additional Amounts, if applicable)
in respect of the Preferred Securities shall be made by check mailed to the
address of the Person entitled thereto as such address shall appear on the
Securities Register or, if the Preferred Securities are held by a Clearing
Agency, such Distributions shall be made to the Clearing Agency in immediately
available funds, which will credit the relevant accounts on the applicable
Distribution Dates. Payments in respect of the Common Securities shall be made
in such manner as shall be mutually agreed between the Property Trustee and the
Common Securityholder.
SECTION 405. TAX RETURNS AND REPORTS.
The Administrative Trustees shall prepare (or cause to be prepared), at
the Depositor's expense, and file all United States federal, state and local tax
and information returns and reports required to be filed by or in respect of the
Trust. In this regard, the Administrative Trustees shall (a) prepare and file
(or cause to be prepared and filed) the appropriate Internal Revenue Service
form required to be filed in respect of the Trust in each taxable year of the
Trust; and (b) prepare and furnish (or cause to be prepared and furnished) to
each Securityholder the appropriate Internal Revenue Service form required to be
furnished to such Securityholder or the information required to be provided on
such form. The Administrative Trustees shall provide the Depositor with a copy
of all such returns and reports promptly after such filing or furnishing. The
Property Trustee shall comply with United States federal withholding and backup
withholding tax laws and information reporting requirements with respect to any
payments to Securityholders under the Trust Securities.
SECTION 406. PAYMENT OF TAXES, DUTIES, ETC. OF THE TRUST.
Upon receipt under the Debentures of Additional Interest, the Property
Trustee, at the written direction of an Administrative Trustee or the Depositor,
shall promptly pay any taxes, duties or governmental charges of whatsoever
nature (other than withholding taxes) imposed on the Trust by the United States
or any other taxing authority.
SECTION 407. PAYMENTS UNDER INDENTURE.
Any amount payable hereunder to any Holder of Preferred Securities
shall be reduced by the amount of any corresponding payment such Holder (or any
related Owner) has directly received under the Indenture pursuant to Section
512(b) or (c) hereof.
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ARTICLE V
TRUST SECURITIES CERTIFICATES
SECTION 501. INITIAL OWNERSHIP.
Upon the creation of the Trust and the contribution by the Depositor
pursuant to Section 203 and until the issuance of the Trust Securities, and at
any time during which no Trust Securities are outstanding, the Depositor shall
be the sole beneficial owner of the Trust.
SECTION 502. THE TRUST SECURITIES CERTIFICATES.
(a) The Preferred Securities Certificates shall be issued in minimum
denominations of $10 Liquidation Amount and integral multiples of $10 in excess
thereof, and the Common Securities Certificates shall be issued in denominations
of $10 Liquidation Amount and integral multiples thereof. The Trust Securities
Certificates shall be executed on behalf of the Trust by manual, facsimile or
imprinted signature of at least one Administrative Trustee and the Property
Trustee shall manually authenticate and register the Preferred Securities
Certificates, except as provided in Section 503. Trust Securities Certificates
bearing the signatures of individuals who were, at the time when such signatures
shall have been affixed, authorized to sign on behalf of the Trust, shall be
validly issued and entitled to the benefits of this Trust Agreement,
notwithstanding that such individuals or any of them shall have ceased to be so
authorized prior to the delivery of such Trust Securities Certificates or did
not hold such offices at the date of delivery of such Trust Securities
Certificates. A transferee of a Trust Securities Certificate shall become a
Securityholder, and shall be entitled to the rights and subject to the
obligations of a Securityholder hereunder, upon due registration of such Trust
Securities Certificate in such transferee's name pursuant to Sections 504 and
511a.
(b) Upon their original issuance, Preferred Securities Certificates
shall be issued in the form of one or more fully registered Global Preferred
Securities Certificates which will be deposited with or on behalf of the
Depositary and registered in the name of the Depositary's nominee. Unless and
until it is exchangeable in whole or in part for the Preferred Securities in
definitive form, a global security may not be transferred except as a whole by
the Depositary to a nominee of the Depositary or by a nominee of the Depositary
to the Depositary or another nominee of the Depositary or by the Depositary or
any such nominee to a successor of such Depositary or a nominee of such
successor.
(c) A single Common Securities Certificate representing the Common
Securities shall be issued to the Depositor in the form of a definitive Common
Securities Certificate.
SECTION 503. EXECUTION AND DELIVERY OF TRUST SECURITIES CERTIFICATES.
On the Closing Date and on the date on which the Underwriters exercise
the option to purchase additional Preferred Securities, as applicable (the
"Option Closing Date"), the Administrative Trustees shall cause Trust Securities
Certificates, in an aggregate Liquidation
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Amount as provided in Sections 204 and 205, to be executed by manual, facsimile
or imprinted signature on behalf of the Trust by at least one of the
Administrative Trustees and delivered to the Property Trustee and upon such
delivery, the Property Trustee shall manually authenticate and register the
Preferred Securities Certificates and make available for delivery such Preferred
Securities Certificates upon the written order of the Depositor, executed by its
Chairman of the Board, Chief Executive Officer or President or any Vice
President and the Chief Financial Officer, Treasurer or an Assistant Treasurer
or Secretary or Assistant Secretary without further corporate action by the
Depositor, in authorized denominations.
SECTION 503A. GLOBAL PREFERRED SECURITIES.
(a) Each Global Preferred Security issued under this Trust Agreement
shall be registered in the name of the Clearing Agency designated by the
Depositor for the related Global Preferred Securities or a nominee thereof and
delivered to such Clearing Agency or a nominee thereof or custodian therefor.
(b) Notwithstanding any other provision in this Trust Agreement, no
Global Preferred Securities may be exchanged in whole or in part for Preferred
Securities registered, and no transfer of Global Preferred Securities in whole
or in part may be registered, in the name of any Person other than the Clearing
Agency for such Global Preferred Securities or a nominee thereof unless (a) the
Clearing Agency advises the Property Trustee in writing that the Clearing Agency
is no longer willing or able to properly discharge its responsibilities with
respect to the Global Preferred Securities, and the Administrative Trustees are
unable to locate a qualified successor, (b) the Trust at its option advises the
Clearing Agency in writing that it elects to eliminate the global system through
the Clearing Agency, (c) after the occurrence of a Debenture Event of Default or
(d) pursuant to the following sentence. All or any portion of a Global Preferred
Security may be exchanged for a Preferred Security that has a like aggregate
principal amount and is not a Global Preferred Security upon 20 days' prior
written request made by the Clearing Agency or its authorized representative to
the Property Trustee; provided, however that no Definitive Preferred Securities
Certificate shall be issued in an amount representing less than $100,000 in
Aggregate Liquidation Amount of Preferred Securities. Upon the occurrence of any
event specified in clause (a), (b) or (c) above, the Administrative Trustees
shall notify the Clearing Agency and the Clearing Agency shall notify all Owners
of beneficial interests in Global Preferred Securities, the Delaware Trustee,
the Property Trustee and the Administrative Trustees of the occurrence of such
event and of the availability of the Definitive Preferred Securities
Certificates to such Owners requesting the same; provided, however, that no
Definitive Preferred Securities Certificates shall be issued in an amount
representing less than $10 in aggregate Liquidation Amount of Preferred
Securities. Upon surrender to the Administrative Trustees of the typewritten
Preferred Securities Certificate or certificates representing the Global
Preferred Securities held by the Clearing Agency, accompanied by registration
instructions, the Administrative Trustees, or any one of them, shall execute a
Definitive Preferred Securities Certificate in accordance with the instructions
of the Clearing Agency. Neither the Securities Registrar nor the Trustees shall
be liable for any delay in delivery of such instructions and may conclusively
rely on, and shall be protected in relying on, such instructions. Upon the
issuance
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of the Definitive Preferred Securities Certificate, the Trustees shall recognize
the Holder of a Definitive Preferred Securities Certificate as a Securityholder.
Definitive Preferred Securities Certificates shall be printed, lithographed or
engraved or may be produced in any other manner as is reasonably acceptable to
the Administrative Trustees, as evidenced by the execution thereof by the
Administrative Trustees or any one of them.
(c) If any Global Preferred Security is to be exchanged for Definitive
Preferred Securities Certificates or cancelled in part, or if Definitive
Preferred Securities Certificates are to be exchanged in whole or in part for a
Global Preferred Security, then either (i) such Global Preferred Security shall
be so surrendered for exchange or cancellation as provided in this Article V or
(ii) the aggregate Liquidation Amount represented by such Global Preferred
Security shall be reduced, subject to Section 502, or increased, by an amount
equal to the Liquidation Amount represented by that portion of the Global
Preferred Security to be so exchanged or cancelled, or equal to the Liquidation
Amount represented by such Definitive Preferred Securities Certificates to be so
exchanged for beneficial interests in the Global Preferred Security represented
thereby, as the case may be, by means of an appropriate adjustment made on the
records of the Securities Registrar, whereupon the Property Trustee, in
accordance with the Applicable Procedures, shall instruct the Clearing Agency or
its authorized representative to make a corresponding adjustment to its records.
Upon surrender to the Administrative Trustees or the Securities Registrar of the
Global Preferred Security by the Clearing Agency, accompanied by registration
instructions, the Administrative Trustees, or any one of them, shall execute the
Definitive Preferred Securities Certificates in accordance with the instructions
of the Clearing Agency and Section 502 hereof; provided, however, that no
Definitive Preferred Securities Certificates shall be issued in an amount
representing less than $100,000 in Aggregate Liquidation Amount of Preferred
Securities. None of the Securities Registrar, the Trustees or the Administrative
Trustees shall be liable for any delay in delivery of such instructions and may
conclusively rely on, and shall be protected in relying on, such instructions.
Upon the issuance of Definitive Preferred Securities Certificates, the Trustees
and Administrative Trustees shall recognize the Holders of the Definitive
Preferred Securities Certificates as Securityholders.
(d) Every Definitive Preferred Securities Certificate executed and
delivered upon registration of, transfer of, or in exchange for or in lieu of, a
Global Preferred Security or any portion thereof, whether pursuant to this
Article V or Article IV or otherwise, shall be executed and delivered in the
form of, and shall be, a Global Preferred Security, unless such Definitive
Preferred Securities Certificate is registered in the name of a Person other
than the Clearing Agency for such Global Preferred Security or a nominee
thereof.
(e) The Clearing Agency or its nominee, as registered owner of a Global
Preferred Security, shall be the Holder of such Global Preferred Security for
all purposes under this Trust Agreement and the Global Preferred Security, and
Owners with respect to a Global Preferred Security shall hold such interests
pursuant to the Applicable Procedures. The Securities Registrar and the Trustees
shall be entitled to deal with the Clearing Agency for all purposes of this
Trust Agreement relating to the Global Preferred Securities (including the
payment of the Liquidation Amount of and Distributions on the beneficial
interests in Global Preferred Securities represented
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thereby and the giving of instructions or directions to Owners of Global
Preferred Securities represented thereby) as the sole Holder of the Global
Preferred Securities represented thereby and shall have no obligations to the
Owners thereof. Neither the Property Trustee nor the Securities Registrar shall
have any liability in respect of any transfers effected by the Clearing Agency.
The rights of the Owners of the Global Preferred Securities shall be
exercised only through the Clearing Agency and shall be limited to those
established by law, the Applicable Procedures and agreements between such Owners
and the Clearing Agency and/or the Clearing Agency Participants. Pursuant to the
Certificate Depository Agreement, unless and until Definitive Preferred
Securities Certificate are issued pursuant to Section 503a, the initial Clearing
Agency will make global transfers among the Clearing Agency Participants and
receive and transmit payments on the Preferred Securities to such Clearing
Agency Participants.
SECTION 504. REGISTRATION OF TRANSFER AND EXCHANGE OF PREFERRED SECURITIES
CERTIFICATES
(a) The Property Trustee shall keep or cause to be kept, at the office
or agency maintained pursuant to Section 508, a register or registers for the
purpose of registering Trust Securities Certificates and transfers and exchanges
of Preferred Securities Certificates (herein referred to as the "Securities
Register") in which the registrar and transfer agent (the "Securities
Registrar"), subject to such reasonable regulations as it may prescribe, shall
provide for the registration of Preferred Securities Certificates and Common
Securities Certificates (subject to Section 510 in the case of the Common
Securities Certificates) and registration of transfers and exchanges of
Preferred Securities Certificates as herein provided. The Property Trustee shall
be the initial Securities Registrar.
Upon surrender for registration of transfer of any Preferred Securities
Certificate at the office or agency maintained pursuant to Section 508, the
Administrative Trustees or any one of them shall execute and the Property
Trustee shall authenticate and make available for delivery, in the name of the
designated transferee or transferees, one or more new Preferred Securities
Certificates in authorized denominations of a like aggregate Liquidation Amount
dated the date of execution by such Administrative Trustee or Trustees. The
Securities Registrar shall not be required to register the transfer of any
Preferred Securities that have been called for redemption. At the option of a
Holder, Preferred Securities Certificates may be exchanged for other Preferred
Securities Certificates in authorized denominations of the same class and of a
like aggregate Liquidation Amount upon surrender of the Preferred Securities
Certificates to be exchanged at the office or agency maintained pursuant to
Section 508.
Every Preferred Securities Certificate presented or surrendered for
registration of transfer or exchange shall be accompanied by a written
instrument of transfer in form satisfactory to the Property Trustee and the
Securities Registrar duly executed by the Holder or his attorney duly authorized
in writing. Each Preferred Securities Certificate surrendered for registration
of transfer or exchange shall be canceled and subsequently disposed of by the
Property Trustee in accordance with its customary practice. The Trust shall not
be required to (i) issue, register the transfer of, or exchange any Preferred
Securities during a period beginning at the opening of
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business 15 calendar days before the date of mailing of a notice of redemption
of any Preferred Securities called for redemption and ending at the close of
business on the day of such mailing; or (ii) register the transfer of or
exchange of any Preferred Securities so selected for redemption, in whole or in
part, except the unredeemed portion of any such Preferred Securities being
redeemed in part.
No service charge shall be made for any registration of transfer or
exchange of Preferred Securities Certificates, but the Securities Registrar may
require payment of a sum sufficient to cover any tax or governmental charge that
may be imposed in connection with any transfer or exchange of Preferred
Securities Certificates.
(b) Trust Securities may only be transferred, in whole or in part, in
accordance with the terms and conditions set forth in this Trust Agreement. To
the fullest extent permitted by law, any transfer or purported transfer of any
Trust Security not made in accordance with this Trust Agreement shall be null
and void.
(i) A Trust Security that is not a Global Preferred Security
may be transferred, in whole or in part, to a Person who takes delivery
in the form of another Trust Security that is not a Global Preferred
Security as provided in Section 504(a).
(ii) Subject to this Section 504, Preferred Securities shall
be freely transferable.
(iii) A beneficial interest in Global Preferred Security may
be exchanged for a Preferred Security that is not a Global Preferred
Security as provided in Section 503a.
SECTION 505. MUTILATED, DESTROYED, LOST OR STOLEN TRUST SECURITIES CERTIFICATES.
If (a) any mutilated Trust Securities Certificate shall be surrendered
to the Securities Registrar, or if the Securities Registrar shall receive
evidence to its satisfaction of the destruction, loss or theft of any Trust
Securities Certificate, and (b) there shall be delivered to the Securities
Registrar and the Administrative Trustees such security or indemnity as may be
required by them to save each of them harmless, then in the absence of notice
that such Trust Securities Certificate shall have been acquired by a bona fide
purchaser, the Administrative Trustees, or any one of them, on behalf of the
Trust shall execute by manual, facsimile or imprinted signature and the Property
Trustee in the case of a Preferred Securities Certificate shall authenticate and
make available for delivery, in exchange for or in lieu of any such mutilated,
destroyed, lost or stolen Trust Securities Certificate, a new Trust Securities
Certificate of like class, tenor and denomination. In connection with the
issuance of any new Trust Securities Certificate under this Section 505, the
Administrative Trustees or the Securities Registrar may require the payment of a
sum sufficient to cover any tax or other governmental charge that may be imposed
in connection therewith. Any duplicate Trust Securities Certificate issued
pursuant to this Section 505 shall constitute conclusive evidence of an
undivided beneficial interest in the assets of the Trust, as if originally
issued, whether or not the lost, stolen or destroyed Trust Securities
Certificate shall be found at any time.
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SECTION 506. PERSONS DEEMED SECURITYHOLDERS.
The Trustees, the Paying Agent, the Securities Registrar and Depositor
shall treat any Persons in whose name any Trust Securities are issued as the
owner of such Trust Securities for the purpose of receiving Distributions and
for all other purposes whatsoever, and neither the Trust, the Trustees, the
Administrative Trustees, the Paying Agent, the Securities Registrar nor the
Depositor shall be bound by any notice to the contrary.
SECTION 507. ACCESS TO LIST OF SECURITYHOLDERS' NAMES AND ADDRESSES.
At any time when the Property Trustee is not also acting as the
Securities Registrar, the Administrative Trustees or the Depositor shall furnish
or cause to be furnished to the Property Trustee a list, in such form as the
Property Trustee may reasonably require, of the names and addresses of the
Securityholders as of the most recent record date (a) within one Business Day
after January 30 and June 30 of each year; and (b) promptly after receipt by any
Administrative Trustee or the Depositor of a request therefor from the Property
Trustee in order to enable the Property Trustee to discharge its obligations
under this Trust Agreement, in each case to the extent such information is in
the possession or control of the Administrative Trustees or the Depositor and is
not identical to a previously supplied list or has not otherwise been received
by the Property Trustee in its capacity as Securities Registrar. The rights of
Securityholders to communicate with other Securityholders with respect to their
rights under this Trust Agreement or under the Trust Securities, and the
corresponding rights of the Property Trustee shall be as provided in the Trust
Indenture Act. Each Holder and each Owner shall be deemed to have agreed not to
hold the Depositor, the Property, Trustee, the Delaware Trustee or the
Administrative Trustees accountable by reason of the disclosure of its name and
address, regardless of the source from which such information was derived.
SECTION 508. MAINTENANCE OF OFFICE OR AGENCY.
The Property Trustee shall designate, with the consent of the
Administrative Trustees, which consent shall not be unreasonably withheld, an
office or offices or agency or agencies where Preferred Securities Certificates
may be surrendered for registration of transfer or exchange and where notices
and demands to or upon the Trustees in respect of the Trust Securities
Certificates may be served. The Property Trustee initially designates its
corporate trust office at 101 Barclay Street, Floor 21 West, New York, New York
Attn: Corporate Trust Trustee Administration, as the principal Corporate Trust
Office for such purposes. The Property Trustee shall give prompt written notice
to the Depositor, the Administrative Trustees and to the Securityholders of any
change in the location of the Securities Register or any such office or agency.
SECTION 509. APPOINTMENT OF PAYING AGENT.
The Paying Agent shall make Distributions to Securityholders from the
Payment Account and shall report the amounts of such Distributions to the
Property Trustee and the Administrative
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Trustees. Any Paying Agent shall have the revocable power to withdraw funds from
the Payment Account for the purpose of making the Distributions referred to
above. The Property Trustee may revoke such power and remove the Paying Agent if
such Trustee determines in its sole discretion that the Paying Agent shall have
failed to perform its obligation under this Trust Agreement in any material
respect. The Paying Agent shall initially be the Property Trustee, and any
co-paying agent chosen by the Property Trustee, and acceptable to the
Administrative Trustees and the Depositor. Any Person acting as Paying Agent
shall be permitted to resign as Paying Agent upon 30 days' written notice to the
Administrative Trustees and the Property Trustee. In the event that the Property
Trustee shall no longer be the Paying Agent or a successor Paying Agent shall
resign or its authority to act be revoked, the Property Trustee shall appoint a
successor that is reasonably acceptable to the Administrative Trustees to act as
Paying Agent to execute and deliver to the Trustees an instrument in which such
successor Paying Agent or additional Paying Agent shall agree with the Trustees
that as Paying Agent, such successor Paying Agent or additional Paying Agent
shall hold all sums, if any, held by it for payment to the Securityholders in
trust for the benefit of the Securityholders entitled thereto until such sums
shall be paid to such Securityholders. The Paying Agent shall return all
unclaimed funds to the Property Trustee and, upon removal of a Paying Agent,
such Paying Agent shall also return all funds in its possession to the Property
Trustee. The provisions of Sections 801, 803 and 806 shall apply to the Property
Trustee also in its role as Paying Agent, for so long as the Property Trustee
shall act as Paying Agent and, to the extent applicable, to any other Paying
Agent appointed hereunder. Any reference in this Trust Agreement to the Paying
Agent shall include any co-paying agent unless the context requires otherwise.
SECTION 510. OWNERSHIP OF COMMON SECURITIES BY DEPOSITOR.
On the Closing Date, the Depositor shall acquire and retain beneficial
and record ownership of the Common Securities. To the fullest extent permitted
by law, any attempted transfer of the Common Securities (other than a transfer
pursuant to Section 12.1 of the Indenture) shall be void. The Administrative
Trustees shall cause each Common Securities Certificate issued to the Depositor
to contain a legend stating "THIS CERTIFICATE IS NOT TRANSFERABLE EXCEPT TO A
SUCCESSOR IN INTEREST TO THE DEPOSITOR IN COMPLIANCE WITH APPLICABLE LAW AND
SECTION 510 OF THIS TRUST AGREEMENT."
SECTION 511. NOTICES TO CLEARING AGENCY.
To the extent that a notice or other communication to the Holders is
required under this Trust Agreement, for so long as Preferred Securities are
represented by a Global Preferred Securities Certificate, the Trustees shall
give all such notices and communications specified herein to be given to the
Clearing Agency, and shall have no obligations to the Owners.
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SECTION 511A. DEFINITIVE PREFERRED SECURITIES CERTIFICATE AND TEMPORARY
PREFERRED SECURITIES.
(a) If (a) the Clearing Agency advises the Trustees in writing that the
Clearing Agency is no longer willing or able to discharge properly its
responsibilities with respect to the Preferred Security, and the Depositor is
unable to locate a qualified successor, (b) the Trust at its option advises the
Trustees in writing that it elects to terminate the book-entry system through
the Clearing Agency or (c) after the occurrence of a Debenture Event of Default,
Holders of a beneficial interest in Preferred Security representing beneficial
interests aggregating at least a majority of the Liquidation Amount advise the
Administrative Trustees in writing that the continuation of a book-entry system
though the Clearing Agency is no longer in the best interest of the Holders of
Preferred Securities, then the Administrative Trustees shall notify the Clearing
Agency and the Clearing Agency shall notify the Holders of Preferred Securities
and the other Trustees of the occurrence of such event and of the availability
of a Definitive Preferred Securities Certificates to Holders of such class
requesting the same.
(b) Pending the preparation of permanent Definitive Preferred
Securities Certificates, an Administrative Trustee may cause to be executed and
delivered on behalf of the Trust temporary Preferred Securities (the "Temporary
Preferred Securities"), which Temporary Preferred Securities are printed,
lithographed, typewritten, mimeographed or otherwise produced, in any authorized
denomination, substantially of the tenor of the Definitive Preferred Securities
Certificates in lieu of which they are issued and with such appropriate
insertions, omissions, substitutions and other variations of the officers
executing such Temporary Preferred Securities may determine, as evidenced by
their execution thereof.
If Temporary Preferred Securities are issued, an Administrative Trustee
will cause Definitive Preferred Securities Certificates to be prepared without
unreasonable delay. After the preparation of the Definitive Preferred Securities
Certificates, the Temporary Preferred Securities shall be exchangeable for
Definitive Preferred Securities Certificates upon surrender of the Temporary
Preferred Securities at any office or agency of the Depositor designated herein,
without charge to the Holder. Upon surrender for cancellation of any one or more
Temporary Preferred Securities, an Administrative Trustee shall execute by
manual, facsimile or imprinted signature and the Property Trustee shall
authenticate and make available for delivery in exchange therefor a like
principal amount of Definitive Preferred Securities Certificates of authorized
denominations. Until so exchanged the Temporary Preferred Securities shall in
all respects be entitled to the same benefits as Definitive Preferred Securities
Certificates.
SECTION 512. RIGHTS OF SECURITYHOLDERS.
(a) The legal title to the Trust Property is vested exclusively in the
Property Trustee (in its capacity as such) in accordance with Section 209, and
the Securityholders shall not have any right or title therein other than the
undivided beneficial interest in the assets of the Trust conferred by their
Trust Securities and they shall have no right to call for any partition or
division of property, profits or rights of the Trust except as described below.
The Trust Securities shall be personal property giving only the rights
specifically set forth therein and in this Trust
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Agreement. The Trust Securities shall have no preemptive or similar rights. When
issued and delivered to Holders of the Trust Securities against payment of the
purchase price therefor, the Trust Securities shall be fully paid and
nonassessable, undivided beneficial interests in the assets of the Trust. The
Holders of the Trust Securities, in their capacities as such, shall be entitled
to the same limitation of personal liability extended to stockholders of private
corporations for profit organized under the General Corporation Law of the State
of Delaware.
(b) For so long as any Preferred Securities remain Outstanding, if,
upon a Debenture Event of Default, the Debenture Trustee fails or the holders of
not less than 25% in principal amount of the outstanding Debentures fail to
declare the principal of all of the Debentures to be immediately due and
payable, the Holders of at least 25% in Liquidation Amount of the Preferred
Securities then Outstanding shall have such right to make such declaration by a
notice in writing to the Depositor, the Property Trustee and the Debenture
Trustee; and upon any such declaration such principal amount of and the accrued
interest on all of the Debentures shall become immediately due and payable,
provided that the payment of principal and interest on such Debentures shall
remain subordinated to the extent provided in the Indenture.
At any time after such declaration of acceleration with respect to the
Debentures has been made and before a judgment or decree for payment of the
money due has been obtained by the Debenture Trustee as provided in the
Indenture, the Holders of a majority in Liquidation Amount of the Preferred
Securities, by written notice to the Property Trustee, the Depositor and the
Debenture Trustee, may rescind and annul such declaration and its consequences
if:
(i) the Depositor has paid or deposited with the
Debenture Trustee a sum sufficient to pay
(A) all overdue installments of interest on all of
the Debentures,
(B) any accrued Additional Interest on all of the
Debentures,
(C) the principal of (and premium, if any, on) any
Debentures which have become due otherwise than by such
declaration of acceleration and interest and Additional
Interest thereon at the rate borne by the Debentures, and
(D) all sums paid or advanced by the Debenture
Trustee under the Indenture and the reasonable compensation,
expenses, disbursements and advances of the Debenture
Trustee and the Property Trustee, their agents and counsel;
and
(ii) all Debenture Event of Default, other than the
non-payment of the principal of the Debentures which has become due
solely by such acceleration, have been cured or waived as provided in
the Indenture.
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If the Property Trustee fails to annul any such declaration and waive
such default, the Holders of at least a majority in Liquidation Amount of the
Preferred Securities shall also have the right to rescind and annul such
declaration and its consequences by written notice to the Depositor, the
Property Trustee and the Debenture Trustee, subject to the satisfaction of the
conditions set forth in clause (i) and (ii) of this Section 512.
The Holders of at least a majority in Liquidation Amount of the
Preferred Securities may, on behalf of the Holders of all the Preferred
Securities, waive any past default under the Indenture, except a default in the
payment of principal and interest (unless such default has been cured and a sum
sufficient to pay all matured installments of interest and principal due
otherwise than by acceleration has been deposited with the Debenture Trustee) or
a default in respect of a covenant or provision which under the Indenture cannot
be modified or amended without the consent of the holder of each outstanding
Debenture. No such rescission shall affect any subsequent default or impair any
right consequent thereon.
Upon receipt by the Property Trustee of written notice declaring such
an acceleration, or rescission and annulment thereof, by Holders of the
Preferred Securities all or part of which is represented by Global Preferred
Securities, a record date shall be established for determining Holders of
Outstanding Preferred Securities entitled to join in such notice, which record
date shall be at the close of business on the day the Property Trustee receives
such notice. The Holders on such record date, or their duly designated proxies,
and only such Persons, shall be entitled to join in such notice, whether or not
such Holders remain Holders after such record date; provided, that, unless such
declaration of acceleration, or rescission or annulment, as the case may be,
shall have become effective by virtue of the requisite percentage having joined
in such notice prior to the day which is 90 days after the record date, such
notice of declaration of acceleration, or rescission and annulment, as the case
may be, shall automatically and without further action by any Holder be
cancelled and of no further effect. Nothing in this paragraph shall prevent a
Holder, or a proxy of a Holder, from giving, after expiration of such 90-day
period, a new written notice of declaration of acceleration, or rescission and
annulment thereof, as the case may be, that is identical to a written notice
which has been cancelled pursuant to the proviso to the preceding sentence, in
which event a new record date shall be established pursuant to the provisions of
this Section 512.
(c) For so long as any Preferred Securities remain Outstanding, upon a
Debenture Event of Default arising from the failure to pay interest or principal
on the Debentures, any Holders of Preferred Securities then Outstanding shall,
to the fullest extent permitted by law and subject to the terms of this Trust
Agreement and the Indenture, have the right to institute a proceeding directly
against the Depositor for enforcement of payment to such Holder of principal of
or interest on the Debentures having a principal amount equal to the Liquidation
Amount of the Preferred Securities of such Holder.
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SECTION 513. CUSIP NUMBERS.
The Depositor in issuing the Debentures may use "CUSIP" numbers (if
then generally in use), and, if so, the Debenture Trustee shall use "CUSIP"
numbers in notices of redemption as a convenience to holders; provided that any
such notice may state that no representation is made as to the correctness of
such numbers either as printed on the Debentures or as contained in any notice
of a redemption and that reliance may be placed only on the other identification
numbers printed on the Debentures, and any such redemption shall not be affected
by any defect in or omission of such numbers. The Depositor will promptly notify
the Property Trustee of any change in the CUSIP numbers.
ARTICLE VI
ACTS OF SECURITYHOLDERS; MEETINGS; VOTING
SECTION 601. LIMITATIONS ON VOTING RIGHTS.
(a) Except as provided in this Section 601, in Sections 512, 810 and
1002 and in the Indenture and as otherwise required by law, no Holder of
Preferred Securities shall have any right to vote or in any manner otherwise
control the administration, operation and management of the Trust or the
obligations of the parties hereto, nor shall anything herein set forth, or
contained in the terms of the Trust Securities Certificates, be construed so as
to constitute the Securityholders from time to time as partners or members of an
association.
(b) So long as any Debentures are held by the Property Trustee, the
Trustees shall not (i) direct the time, method and place of conducting any
proceeding for any remedy available to the Debenture Trustee, or executing any
trust or power conferred on the Debenture Trustee with respect to such
Debentures; (ii) waive any past default which is waivable under Article VII of
the Indenture; (iii) exercise any right to rescind or annul a declaration that
the principal of all the Debentures shall be due and payable; or (iv) consent to
any amendment, modification or termination of the Indenture or the Debentures,
where such consent shall be required, without, in each case, obtaining the prior
approval of the Holders of at least a majority in Liquidation Amount of all
Outstanding Preferred Securities; provided, however, that where a consent under
the Indenture would require the consent of each holder of outstanding Debentures
affected thereby, no such consent shall be given by the Property Trustee without
the prior written consent of each Holder of Preferred Securities. The Trustees
shall not revoke any action previously authorized or approved by a vote of the
Holders of the Outstanding Preferred Securities, except by a subsequent vote of
the Holders of the Outstanding Preferred Securities. The Property Trustee shall
notify each Holder of Outstanding Preferred Securities of any notice of default
received from the Debenture Trustee with respect to the Debentures. In addition
to obtaining the foregoing approvals of the Holders of the Preferred Securities,
prior to taking any of the foregoing actions, the Administrative Trustees shall
provide to the Property Trustee, at the expense of the Depositor, an Opinion of
Counsel to the effect that the Trust shall continue to be classified as a
grantor trust
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and not as an association taxable as a corporation for United States federal
income tax purposes on account of such action.
(c) If any proposed amendment to the Trust Agreement provides for, or
the Trustees otherwise propose to effect, (i) any action that would adversely
affect in any material respect the powers, preferences or special rights of the
Preferred Securities, whether by way of amendment to the Trust Agreement or
otherwise; or (ii) the dissolution, winding-up or termination of the Trust,
other than pursuant to the terms of this Trust Agreement, then the Holders of
Outstanding Preferred Securities as a class shall be entitled to vote on such
amendment or proposal and such amendment or proposal shall not be effective
except with the approval of the Holders of at least a majority in Liquidation
Amount of the Outstanding Preferred Securities. No amendment to this Trust
Agreement may be made if, as a result of such amendment, the Trust would cease
to be classified as a grantor trust or would be classified as an association
taxable as a corporation for United States federal income tax purposes.
SECTION 602. NOTICE OF MEETINGS.
Notice of all meetings of the Preferred Securityholders, stating the
time, place and purpose of the meeting, shall be given by the Property Trustee
pursuant to Section 1008 to each Preferred Securityholder of record, at his
registered address, at least 15 days and not more than 90 days before the
meeting. At any such meeting, any business properly before the meeting may be so
considered whether or not stated in the notice of the meeting. Any adjourned
meeting may be held as adjourned without further notice.
SECTION 603. MEETINGS OF PREFERRED SECURITYHOLDERS.
(a) No annual meeting of Securityholders is required to be held. The
Administrative Trustees, however, shall call a meeting of Securityholders to
vote on any matter in respect of which Preferred Securityholders are entitled to
vote upon the written request of the Preferred Securityholders of 25% of the
Outstanding Preferred Securities (based upon their aggregate Liquidation Amount)
and the Administrative Trustees or the Property Trustee may, at any time in
their discretion, call a meeting of Preferred Securityholders to vote on any
matters as to which the Preferred Securityholders are entitled to vote.
(b) Preferred Securityholders of record of 50% of the Outstanding
Preferred Securities (based upon their aggregate Liquidation Amount), present in
person or by proxy shall constitute a quorum at any meeting of Securityholders.
(c) If a quorum is present at a meeting, an affirmative vote by the
Preferred Securityholders of record present, in person or by proxy, holding more
than a majority of the Preferred Securities (based upon their aggregate
Liquidation Amount) held by the Preferred Securityholders of record present,
either in person or by proxy, at such meeting shall constitute the action of the
Securityholders unless this Trust Agreement requires a greater number of
affirmative votes.
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SECTION 604. VOTING RIGHTS.
Securityholders shall be entitled to one vote for each $10 of
Liquidation Amount represented by their Trust Securities in respect of any
matter as to which such Securityholders are entitled to vote.
SECTION 605. PROXIES, ETC.
At any meeting of Securityholders, any Securityholder entitled to vote
thereat may vote by proxy, provided that no proxy shall be voted at any meeting
unless it shall have been placed on file with the Administrative Trustees, or
with such other officer or agent of the Trust as the Administrative Trustees may
direct, for verification prior to the time at which such vote shall be taken.
When Trust Securities are held jointly by several Persons, any one of them may
vote at any meeting in person or by proxy in respect of such Trust Securities,
but if more than one of them shall be present at such meeting in person or by
proxy, and such joint owners or their proxies so present disagree as to any vote
to be cast, such vote shall not be received in respect of such Trust Securities.
A proxy purporting to be executed by or on behalf of a Securityholder shall be
deemed valid unless challenged at or prior to its exercise, and, the burden of
proving invalidity shall rest on the challenger. No proxy shall be valid more
than three years after its date of execution.
SECTION 606. SECURITYHOLDER ACTION BY WRITTEN CONSENT.
Any action which may be taken by Securityholders at a meeting may be
taken without a meeting if Securityholders holding a majority of all Outstanding
Trust Securities (based upon their aggregate Liquidation Amount) entitled to
vote in respect of such action (or such larger proportion thereof as shall be
required by any express provision of this Trust Agreement) shall consent to the
action in writing (based upon their aggregate Liquidation Amount).
SECTION 607. RECORD DATE FOR VOTING AND OTHER PURPOSES.
For the purposes of determining the Securityholders who are entitled to
notice of and to vote at any meeting or by written consent, or to participate in
any Distribution on the Trust Securities in respect of which a record date is
not otherwise provided for in this Trust Agreement, or for the purpose of any
other action, the Administrative Trustees may from time to time fix a date, not
more than 90 days prior to the date of any meeting of Securityholders or the
payment of any Distribution or other action as the case may be, as a record date
for the determination of the identity of the Securityholders of record for such
purposes.
SECTION 608. ACTS OF SECURITYHOLDERS.
(a) Any request, demand, authorization, direction, notice, consent,
waiver or other action provided or permitted by this Trust Agreement to be
given, made or taken by Securityholders may be embodied in and evidenced by one
or more instruments of substantially
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similar tenor signed by such Securityholders in person or by an agent duly
appointed in writing, and, except as otherwise expressly provided herein, such
action shall become effective when such instrument or instruments are delivered
to an Administrative Trustee. Such instrument or instruments (and the action
embodied therein and evidenced thereby) are herein sometimes referred to as the
"Act" of the Securityholders signing such instrument or instruments. Proof of
execution of any such instrument or of a writing appointing any such agent shall
be sufficient for any purpose of this Trust Agreement and (subject to Section
801) conclusive in favor of the Trustees, if made in the manner provided in this
Section 608.
(b) The fact and date of the execution by any Person of any such
instrument or writing may be proved by the affidavit of a witness of such
execution or by a certificate of a notary public or other officer authorized by
law to take acknowledgments of deeds, certifying that the individual signing
such instrument or writing acknowledged to him the execution thereof. Where such
execution is by a signer acting in a capacity other than his individual
capacity, such certificate or affidavit shall also constitute sufficient proof
of his authority. The fact and date of the execution of any such instrument or
writing, or the authority of the Person executing the same, may also be proved
in any other manner which any Trustee receiving the same deems sufficient.
(c) The ownership of Preferred Securities shall be proved by the
Securities Register.
(d) Any request, demand, authorization, direction, notice, consent,
waiver or other Act of the Securityholder of any Trust Security shall bind every
future Securityholder of the same Trust Security and the Securityholder of every
Trust Security issued upon the registration of transfer thereof or in exchange
therefor or in lieu thereof in respect of anything done, omitted or suffered to
be done by the Trustees or the Trust in reliance thereon, whether or not
notation of such action is made upon such Trust Security.
(e) Without limiting the foregoing, a Securityholder entitled hereunder
to take any action hereunder with regard to any particular Trust Security may do
so with regard to all or any part of the Liquidation Amount of such Trust
Security or by one or more duly appointed agents each of which may do so
pursuant to such appointment with regard to all or any part of such Liquidation
Amount.
SECTION 609. INSPECTION OF RECORDS.
Upon reasonable notice to the Administrative Trustees and the Property
Trustee, the records of the Trust shall be open to inspection and copying by
Securityholders and their authorized representatives during normal business
hours for any purpose reasonably related to such Securityholder's interest as a
Securityholder.
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ARTICLE VII
REPRESENTATIONS AND WARRANTIES
SECTION 701. REPRESENTATIONS AND WARRANTIES OF THE PROPERTY TRUSTEE AND THE
DELAWARE TRUSTEE.
The Property Trustee and the Delaware Trustee, each severally on behalf
of and as to itself, as of the date hereof, hereby represents and warrants for
the benefit of the Depositor and the Securityholders that:
(a) the Property Trustee is a New York banking corporation, duly
organized, validly existing and in good standing under the laws of the State of
New York;
(b) the Property Trustee has full corporate power, authority and legal
right to execute, deliver and perform its obligations under this Trust Agreement
and has taken all necessary action to authorize the execution, delivery and
performance by it of this Trust Agreement;
(c) the Delaware Trustee is a Delaware banking corporation, duly
organized, validly existing and in good standing in the State of Delaware;
(d) the Delaware Trustee has full corporate power, authority and legal
right to execute, deliver and perform its obligations under this Trust Agreement
and has taken all necessary action to authorize the execution, delivery and
performance by it of this Trust Agreement;
(e) this Trust Agreement has been duly authorized, executed and
delivered by the Property Trustee and the Delaware Trustee and constitutes the
valid and legally binding agreement of the Property Trustee and the Delaware
Trustee enforceable against each of them in accordance with its terms, subject
to bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and
similar laws of general applicability relating to or affecting creditors rights
and to general equity principles;
(f) the execution, delivery and performance by the Property Trustee and
the Delaware Trustee of this Trust Agreement has been duly authorized by all
necessary corporate or other action on the part of the Property Trustee and
Delaware Trustee and does not require any approval of stockholders of the
Property Trustee or the Delaware Trustee and such execution delivery and
performance shall not (i) violate the charter or by-laws of the Property Trustee
or the Delaware Trustee; (ii) violate any provision of, or constitute, with or
without notice or lapse of time, a default under, or result in the creation or
imposition of, any Lien on any properties included in the Trust Property
pursuant to the provisions of any indenture, mortgage, credit agreement, license
or other agreement or instrument to which the Property Trustee or the Delaware
Trustee is a party or by which it is bound; or (iii) violate any law,
governmental rule or regulation of the State of New York or the State of
Delaware, as the case may be, governing the banking or trust powers of the
Property Trustee or the Delaware Trustee (as appropriate in
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context) or any order, judgment or decree applicable to the Property Trustee or
the Delaware Trustee;
(g) neither the authorization, execution or delivery by the Property
Trustee or the Delaware Trustee of this Trust Agreement nor the consummation of
any of the transactions by the Property Trustee or the Delaware Trustee
contemplated herein or therein requires the consent or approval of, the giving
of notice to, the registration with or the taking of any other action with
respect to any governmental authority or agency under any existing New York or
Delaware law governing the banking or trust powers of the Property Trustee or
the Delaware Trustee, as the case may be; and
(h) there are no proceedings pending or, to the best of each of the
Property Trustee's and the Delaware Trustee's knowledge, threatened against or
affecting the Property Trustee or the Delaware Trustee in any court or before
any governmental authority, agency or arbitration board or tribunal which,
individually or in the aggregate, would materially and adversely affect the
Trust or would question the right, power and authority of the Property Trustee
or the Delaware Trustee, as the case may be, to enter into or perform its
obligations as one of the Trustees under this Trust Agreement.
SECTION 702. REPRESENTATIONS AND WARRANTIES OF DEPOSITOR.
The Depositor hereby represents and warrants for the benefit of the
Securityholders that:
(a) the Trust Securities Certificates issued on the Closing Date or the
Option Closing Date (as defined in the Underwriting Agreement), if applicable,
on behalf of the Trust have been duly authorized and, shall have been, duly and
validly executed, issued and delivered by the Administrative Trustees pursuant
to the terms and provisions of, and in accordance with the requirements of, this
Trust Agreement and the Securityholders shall be, as of such date, entitled to
the benefits of this Trust Agreement; and
(b) there are no taxes, fees or other governmental charges payable by
the Trust (or the Trustees on behalf of the Trust) under the laws of the State
of Delaware or any political subdivision thereof in connection with the
execution, delivery and performance by the Bank or the Property Trustee, as the
case may be, of this Trust Agreement.
ARTICLE VIII
TRUSTEES
SECTION 801. CERTAIN DUTIES AND RESPONSIBILITIES.
(a) The duties and responsibilities of the Trustees shall be as
provided by this Trust Agreement and, in the case of the Property Trustee, by
the Trust Indenture Act. Notwithstanding the foregoing, no provision of this
Trust Agreement shall require the Trustees to expend or risk
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their own funds or otherwise incur any financial liability in the performance of
any of their duties hereunder, or in the exercise of any of their rights or
powers, if they shall have reasonable grounds for believing that repayment of
such funds or adequate indemnity against such risk or liability is not
reasonably assured to it. No Administrative Trustee shall be liable for its act
or omissions hereunder except as a result of its own gross negligence or bad
faith or willful misconduct. The Property Trustee's liability shall be
determined under the Trust Indenture Act. Whether or not therein expressly so
provided, every provision of this Trust Agreement relating to the conduct or
affecting the liability of or affording protection to the Trustees shall be
subject to the provisions of this Section 801. To the extent that, at law or in
equity, an Administrative Trustee has duties (including fiduciary duties) and
liabilities relating thereto to the Trust or to the Securityholders, such
Administrative Trustee shall not be liable to the Trust or to any Securityholder
for such Trustee's good faith reliance on the provisions of this Trust
Agreement. The provisions of this Trust Agreement, to the extent that they
restrict the duties and liabilities of the Administrative Trustees otherwise
existing at law or in equity, are agreed by the Depositor and the
Securityholders to replace such other duties and liabilities of the
Administrative Trustees.
(b) All payments made by the Property Trustee or a Paying Agent in
respect of the Trust Securities shall be made only from the revenue and proceeds
from the Trust Property and only to the extent that there shall be sufficient
revenue or proceeds from the Trust Property to enable the Property Trustee or a
Paying Agent to make payments in accordance with the terms hereof. With respect
to the relationship of each Securityholder and the Trustees, each
Securityholder, by its acceptance of a Trust Security, agrees that it shall look
solely to the revenue and proceeds from the Trust Property to the extent legally
available for distribution to it as herein provided and that the Trustees are
not personally liable to it for any amount distributable in respect of any Trust
Security or for any other liability in respect of any Trust Security. This
Section 801(b) does not limit the liability of the Trustees expressly set forth
elsewhere in this Trust Agreement or, in the case of the Property Trustee, in
the Trust Indenture Act.
(c) No provision of this Trust Agreement shall be construed to relieve
the Property Trustee from liability for its own negligent action, its own
negligent failure to act, or its own willful misconduct, except that:
(i) the Property Trustee shall not be liable for any error
of judgment made in good faith by an authorized officer of the Property
Trustee, unless it shall be proved that the Property Trustee was
negligent in ascertaining the pertinent facts;
(ii) the Property Trustee shall not be liable with respect
to any action taken or omitted to be taken by it in good faith in
accordance with the direction of the Holders of not less than a
majority in Liquidation Amount of the Trust Securities relating to the
time, method and place of conducting any proceeding for any remedy
available to the Property Trustee, or exercising any trust or power
conferred upon the Property Trustee under this Trust Agreement;
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(iii) the Property Trustee's sole duty with respect to the
custody, safe keeping and physical preservation of the Debentures and
the Payment Account shall be to deal with such property in a similar
manner as the Property Trustee deals with similar property for its own
account, subject to the protections and limitations on liability
afforded to the Property Trustee under this Trust Agreement and the
Trust Indenture Act;
(iv) the Property Trustee shall not be liable for any
interest on any money received by it except as it may otherwise agree
in writing with the Depositor and money held by the Property Trustee
need not be segregated from other funds held by it except in relation
to the Payment Account maintained by the Property Trustee pursuant to
Section 301 and except to the extent otherwise required by law; and
(v) the Property Trustee shall not be responsible for
monitoring the compliance by the Administrative Trustees or the
Depositor with their respective duties under this Trust Agreement, nor
shall the Property Trustee be liable for the negligence, default or
misconduct of the Administrative Trustees or the Depositor.
SECTION 802. CERTAIN NOTICES.
(a) Within 90 days after the occurrence of any Event of Default
actually known to the Property Trustee, the Property Trustee shall transmit, in
the manner and to the extent provided in Section 1008, notice of such Event of
Default to the Securityholders, the Administrative Trustees and the Depositor,
unless such Event of Default shall have been cured or waived.
(b) The Administrative Trustees shall transmit, to the Securityholders
and the Property Trustee in the manner and to the extent provided in Section
1008, notice of the Depositor's election to begin or further extend an Extended
Interest Payment Period on the Debentures (unless such election shall have been
revoked) within the time specified for transmitting such notice to the holders
of the Debentures pursuant to the Indenture as originally executed.
SECTION 803. CERTAIN RIGHTS OF PROPERTY TRUSTEE.
Subject to the provisions of Section 801:
(a) the Property Trustee may conclusively rely and shall be protected
in acting or refraining from acting in good faith upon any resolution, Opinion
of Counsel, certificate, written representation of a Holder or transferee,
certificate of auditors or any other certificate, statement, instrument,
opinion, report, notice, request, consent, order, appraisal, bond, debenture,
note, other evidence of indebtedness or other paper or document believed by it
to be genuine and to have been signed or presented by the proper party or
parties;
(b) if (i) in performing its duties under this Trust Agreement the
Property Trustee is required to decide between alternative courses of action; or
(ii) in construing any of the
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provisions of this Trust Agreement the Property Trustee finds the same ambiguous
or inconsistent with other provisions contained herein; or (iii) the Property
Trustee is unsure of the application of any provision of this Trust Agreement,
then, except as to any matter as to which the Preferred Securityholders are
entitled to vote under the terms of this Trust Agreement, the Property Trustee
shall deliver a notice to the Depositor requesting written instructions of the
Depositor as to the course of action to be taken and the Property Trustee shall
take such action, or refrain from taking such action, as the Property Trustee
shall be instructed in writing to take, or to refrain from taking, by the
Depositor, provided, however, that if the Property Trustee does not receive such
instructions of the Depositor within 10 Business Days after it has delivered
such notice, or such reasonably shorter period of time set forth in such notice
(which to the extent practicable shall not be less than 2 Business Days), it
may, but shall be under no duty to, take or refrain from taking such action not
inconsistent with this Trust Agreement as it shall deem advisable and in the
best interests of the Securityholders, in which event the Property Trustee shall
have no liability except for its own bad faith, negligence or willful
misconduct;
(c) any direction or act of the Depositor or the Administrative
Trustees contemplated by this Trust Agreement shall be sufficiently evidenced by
an Officers' Certificate;
(d) whenever in the administration of this Trust Agreement, the
Property Trustee shall deem it desirable that a matter be established before
undertaking, suffering or omitting any action hereunder, the Property Trustee
(unless other evidence is herein specifically prescribed) may, in the absence of
bad faith on its part, request and conclusively rely upon an Officers'
Certificate which, upon receipt of such request, shall be promptly delivered by
the Depositor or the Administrative Trustees;
(e) the Property Trustee shall have no duty to see to any recording,
filing or registration of any instrument (including any financing or
continuation statement) or any filing under tax or securities laws or any
re-recording, refiling, or reregistration thereof;
(f) the Property Trustee may consult with counsel of its choice (which
counsel may be counsel to the Depositor or any of its Affiliates) and the advice
of such counsel shall be full and complete authorization and protection in
respect of any action taken, suffered or omitted by it hereunder in good faith
and in reliance thereon and in accordance with such advice, the Property Trustee
shall have the right at any time to seek instructions concerning the
administration of this Trust Agreement from any court of competent jurisdiction;
(g) the Property Trustee shall be under no obligation to exercise any
of the rights or powers vested in it by this Trust Agreement at the request or
direction of any of the Securityholders pursuant to this Trust Agreement, unless
such Securityholders shall have offered to the Property Trustee reasonable
security or indemnity against the costs, expenses and liabilities which might be
incurred by it in compliance with such request or direction;
(h) the Property Trustee shall not be bound to make any investigation
into the facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice,
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request, consent, order, approval, bond, debenture, note or other evidence of
indebtedness or other paper or document, unless requested in writing to do so by
one or more Securityholders, but the Property Trustee may make such further
inquiry or investigation into such facts or matters as it may see fit;
(i) the Property Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or through its
agents or attorneys, provided that the Property Trustee shall be responsible for
its own negligence or recklessness with respect to selection of any agent or
attorney appointed by it hereunder;
(j) whenever in the administration of this Trust Agreement the Property
Trustee shall deem it desirable to receive instructions with respect to
enforcing any remedy or right or taking any other action hereunder the Property
Trustee (i) may request written instructions from the Holders of the Trust
Securities which written instructions may only be given by the Holders of the
same proportion in Liquidation Amount of the Trust Securities as would be
entitled to direct the Property Trustee under the terms of the Trust Securities
in respect of such remedy, right or action; (ii) may refrain from enforcing such
remedy or right or taking such other action until such instructions are
received; and (iii) shall be protected in acting in accordance with such written
instructions; and
(k) except as otherwise expressly provided by this Trust Agreement, the
Property Trustee shall not be under any obligation to take any action that is
discretionary under the provisions of this Trust Agreement. No provision of this
Trust Agreement shall be deemed to impose any duty or obligation on the Property
Trustee to perform any act or acts or exercise any right, power, duty or
obligation conferred or imposed on it, in any jurisdiction in which it shall be
illegal, or in which the Property Trustee shall be unqualified or incompetent in
accordance with applicable law, to perform any such act or acts, or to exercise
any such right, power, duty or obligation. No permissive power or authority
available to the Property Trustee shall be construed to be a duty.
SECTION 804. NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF SECURITIES.
The Recitals contained herein and in the Trust Securities Certificates
shall be taken as the statements of the Trust, and the Trustees do not assume
any responsibility for their correctness. The Trustees shall not be accountable
for the use or application by the Depositor of the proceeds of the Debentures.
SECTION 805. MAY HOLD SECURITIES.
Any Trustee or any other agent of any Trustee or the Trust, in its
individual or any other capacity, may become the owner or pledgee of Trust
Securities and, subject to Sections 808 and 813 and except as provided in the
definition of the term "Outstanding" in Article I, may otherwise deal with the
Trust with the same rights it would have if it were not a Trustee or such other
agent.
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SECTION 806. COMPENSATION; INDEMNITY; FEES.
The Depositor agrees:
(a) to pay to the Trustees from time to time such compensation as the
Trustees and the Depositor may agree in writing for all services rendered by
them hereunder (which compensation shall not be limited by any provision of law
in regard to the compensation of a trustee of an express trust);
(b) except as otherwise expressly provided herein, to reimburse the
Trustees upon request for all reasonable expenses, disbursements and advances
incurred or made by the Trustees in accordance with any provision of this Trust
Agreement (including the reasonable compensation and the expenses and
disbursements of its agents and counsel), except any such expense, disbursement
or advance as may be attributable to such Trustee's negligence, bad faith or
willful misconduct (or, in the case of the Administrative Trustees, any such
expense, disbursement or advance as may be attributable to its, his or her gross
negligence, bad faith or willful misconduct); and
(c) to indemnify each of the Trustees or any predecessor Trustee for,
and to hold the Trustees harmless against, any and all loss, damage, claim,
liability, penalty or expense, including taxes (other than taxes based on the
income of the Trustee) incurred without negligence or willful misconduct on its
part, arising out of or in connection with the acceptance or administration of
this Trust Agreement, including the costs and expenses of defending itself
against any claim or liability in connection with the acceptance, exercise or
performance of any of its powers or duties hereunder, except any such expense,
disbursement or advance as may be attributable to such Trustee's negligence, bad
faith or willful misconduct (or, in the case of the Administrative Trustees, any
such expense, disbursement or advance as may be attributable to its, his or her
gross negligence, bad faith or willful misconduct).
The provisions of this Section 806 shall survive the termination of
this Trust Agreement or the earlier resignations or removal of any Trustee.
No Trustee may claim any Lien or charge on any Trust Property as a
result of any amount due pursuant to this Section 806.
When the Trustee incurs expenses or renders services in connection with
a Debenture Event of Default specified in Section 7.1(a)(iv), Section 7.1(a)(v)
or 7.1(a)(vi) of the Indenture, the expenses (including reasonable charges and
expenses of its counsel) and the compensation for the services are intended to
constitute expenses of administration under any applicable Bankruptcy Law.
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SECTION 807. CORPORATE PROPERTY TRUSTEE REQUIRED; ELIGIBILITY OF TRUSTEES.
(a) There shall at all times be a Property Trustee hereunder with
respect to the Trust Securities. The Property Trustee shall be a Person that is
eligible pursuant to the Trust Indenture Act to act as such and has a combined
capital and surplus of at least $50,000,000. If any such Person publishes
reports of condition at least annually, pursuant to law or to the requirements
of its supervising or examining authority, then for the purposes of this Section
807, the combined capital and surplus of such Person shall be deemed to be its
combined capital and surplus as set forth in its most recent report of condition
so published. If at any time the Property Trustee with respect to the Trust
Securities shall cease to be eligible in accordance with the provisions of this
Section 807, it shall resign immediately in the manner and with the effect
hereinafter specified in this Article VIII.
(b) There shall at all times be one or more Administrative Trustees
hereunder with respect to the Trust Securities. Each Administrative Trustee
shall be either a natural person who is at least 21 years of age or a legal
entity that shall act through one or more Persons authorized to bind that
entity.
(c) There shall at all times be a Delaware Trustee with respect to the
Trust Securities. The Delaware Trustee shall either be (i) a natural person who
is at least 21 years of age and a resident of the State of Delaware; or (ii) a
legal entity with its principal place of business in the State of Delaware and
that otherwise meets the requirements of applicable Delaware law that shall act
through one or more Persons authorized to bind such entity.
SECTION 808. CONFLICTING INTERESTS.
If the Property Trustee has or shall acquire a conflicting interest
within the meaning of the Trust Indenture Act, the Property Trustee shall either
eliminate such interest or resign, to the extent and in the manner provided by,
and subject to the provisions of, the Trust Indenture Act and this Trust
Agreement.
SECTION 809. CO-TRUSTEES AND SEPARATE TRUSTEE.
(a) Unless an Event of Default shall have occurred and be continuing,
at any time or times, for the purpose of meeting the legal requirements of the
Trust Indenture Act or of any jurisdiction in which any part of the Trust
Property may at the time be located, the Depositor shall have power to appoint,
and upon the written request of the Property Trustee, the Depositor shall for
such purpose join with the Property Trustee in the execution, delivery and
performance of any instruments and agreements necessary or proper to appoint,
one or more Persons approved by the Property Trustee either to act as
co-trustee, jointly with the Property Trustee, of all or any part of such Trust
Property, or to the extent required by law to act as separate trustee of any
such property, in either case with such powers as may be provided in the
instrument of appointment, and to vest in such Person or Persons in the capacity
aforesaid, any property, title, right or power deemed necessary or desirable,
subject to the other provisions of this Section 809. If the
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Depositor does not join in such appointment within 15 days after the receipt by
it of a request so to do, or in case a Debenture Event of Default has occurred
and is continuing, the Property Trustee alone shall have power to make such
appointment. Any co-trustee or separate trustee appointed pursuant to this
Section 809 shall either be (i) a natural person who is at least 21 years of age
and a resident of the United States; or (ii) a legal entity with its principal
place of business in the United States that shall act through one or more
Persons authorized to bind such entity.
(b) Should any written instrument from the Depositor be required by any
co-trustee or separate trustee so appointed for more fully confirming to such
co-trustee or separate trustee such property, title, right, or power, any and
all such instruments shall, on request, be executed, acknowledged, and delivered
by the Depositor.
(c) Every co-trustee or separate trustee shall, to the extent permitted
by law, but to such extent only, be appointed subject to the following terms,
namely:
(i) The Trust Securities shall be executed and delivered and
all rights, powers, duties and obligations hereunder in respect of the
custody of securities, cash and other personal property held by, or
required to be deposited or pledged with, the Trustees specified
hereunder, shall be exercised, solely by such Trustees and not by such
co-trustee or separate trustee.
(ii) The rights, powers, duties and obligations hereby
conferred or imposed upon the Property Trustee in respect of any
property covered by such appointment shall be conferred or imposed upon
and exercised or performed by the Property Trustee or by the Property
Trustee and such co-trustee or separate trustee jointly, as shall be
provided in the instrument appointing such co-trustee or separate
trustee, except to the extent that under any law of any jurisdiction in
which any particular act is to be performed, the Property Trustee shall
be incompetent or unqualified to perform such act, in which event such
rights, powers, duties and obligations shall be exercised and performed
by such co-trustee or separate trustee.
(iii) The Property Trustee at any time, by an instrument in
writing executed by it, with the written concurrence of the Depositor,
may accept the resignation of or remove any co-trustee or separate
trustee appointed under this Section 809, and, in case a Debenture
Event of Default has occurred and is continuing, the Property Trustee
shall have the power to accept the resignation of, or remove, any such
co-trustee or separate trustee without the concurrence of the
Depositor. Upon the written request of the Property Trustee, the
Depositor shall join with the Property Trustee in the execution,
delivery and performance of all instruments necessary or proper to
effectuate such resignation or removal. A successor to any co-trustee
or separate trustee so resigned or removed may be appointed in the
manner provided in this Section 809.
(iv) No co-trustee or separate trustee hereunder shall be
personally liable by reason of any act or omission of the Property
Trustee or any other Trustee hereunder.
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(v) The Property Trustee shall not be liable by reason of
any act of a co-trustee or separate trustee.
(vi) Any Act of Holders delivered to the Property Trustee
shall be deemed to have been delivered to each such co-trustee and
separate trustee.
SECTION 810. RESIGNATION AND REMOVAL; APPOINTMENT OF SUCCESSOR.
(a) No resignation or removal of any Trustee (the "Relevant Trustee")
and no appointment of a successor Trustee pursuant to this Article VIII shall
become effective until the acceptance of appointment by the successor Trustee in
accordance with the applicable requirements of Section 811.
(b) Subject to the immediately preceding paragraph, the Relevant
Trustee may resign at any time with respect to the Trust Securities by giving
written notice thereof to the Securityholders. If the instrument of acceptance
by the successor Trustee required by Section 811 shall not have been delivered
to the Relevant Trustee within 30 days after the giving of such notice of
resignation, the Relevant Trustee may petition, at the expense of the Depositor,
any court of competent jurisdiction for the appointment of a successor Relevant
Trustee with respect to the Trust Securities.
(c) Unless a Debenture Event of Default shall have occurred and be
continuing, any Trustee may be removed at any time by act of the Common
Securityholder. If a Debenture Event of Default shall have occurred and be
continuing, the Property Trustee or the Delaware Trustee, or both of them, may
be removed at such time by Act of the Holders of a majority in Liquidation
Amount of the Preferred Securities, delivered to the Relevant Trustee (in its
individual capacity and on behalf of the Trust). An Administrative Trustee may
be removed by the Common Securityholder at any time. In no event will the
Holders of the Preferred Securities have the right to vote to appoint, remove or
replace the Administrative Trustees, which voting rights are vested exclusively
in the Common Securityholder. If an instrument of acceptance by a successor
Trustee required by Section 1 shall have not been delivered to the Relevant
Trustee within 30 days after the giving of such notice of removal, the Relevant
Trustee may petition, at the expense of the Depositor, any court of competent
jurisdiction for the appointment of a successor Relevant Trustee with respect to
the Trust Securities.
(d) If any Trustee shall resign, be removed or become incapable of
acting as Trustee, or if a vacancy shall occur in the office of any Trustee for
any cause, at a time when no Debenture Event of Default shall have occurred and
be continuing, the Common Securityholder, by act of the Common Securityholder
delivered to the retiring Trustee, shall promptly appoint a successor Trustee or
Trustees with respect to the Trust Securities and the Trust, and the successor
Trustee shall comply with the applicable requirements of Section 811. If the
Property Trustee or the Delaware Trustee, as the case may be, shall resign, be
removed or become incapable of continuing to act as the Property Trustee at a
time when a Debenture Event of Default shall have occurred and is continuing,
the Preferred Securityholders, by Act of the
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Securityholders of a majority in Liquidation Amount of the Preferred Securities
then Outstanding delivered to the retiring Relevant Trustee, shall promptly
appoint a successor Relevant Trustee or Trustees with respect to the Trust
Securities and the Trust, and such successor Trustee shall comply with the
applicable requirements of Section 811. If an Administrative Trustee shall
resign, be removed or become incapable of acting as Administrative Trustee, at a
time when a Debenture Event of Default shall have occurred and be continuing,
the Common Securityholder, by Act of the Common Securityholder delivered to an
Administrative Trustee, shall promptly appoint a successor Administrative
Trustee or Administrative Trustees with respect to the Trust Securities and the
Trust, and such successor Administrative Trustee or Administrative Trustees
shall comply with the applicable requirements of Section 811. If no successor
Relevant Trustee with respect to the Trust Securities shall have been so
appointed by the Common Securityholder or the Preferred Securityholders and
accepted appointment in the manner required by Section 811, any Securityholder
who has been a Securityholder of Trust Securities on behalf of himself and all
others similarly situated may petition a court of competent jurisdiction for the
appointment of a successor Trustee with respect to the Trust Securities.
(e) The Administrative Trustee shall give notice of each resignation
and each removal of a Trustee and each appointment of a successor Trustee to all
Securityholders in the manner provided in Section 1008 and shall give notice to
the Depositor. Each notice shall include the name of the successor Relevant
Trustee and the address of its Corporate Trust Office if it is the Property
Trustee.
(f) Notwithstanding the foregoing or any other provision of this Trust
Agreement, in the event any Administrative Trustee who is a natural person dies
or becomes, in the opinion of the Depositor, incompetent or incapacitated, the
vacancy created by such death, incompetence or incapacity may be filled by (a)
the unanimous act of the remaining Administrative Trustees if there are at least
two of them; or (b) otherwise by the Depositor (with the successor in each case
being a Person who satisfies the eligibility requirement for Administrative
Trustees as forth in Section 807).
SECTION 811. ACCEPTANCE OF APPOINTMENT BY SUCCESSOR.
(a) In case of the appointment hereunder of a successor Relevant
Trustee with respect to the Trust Securities and the Trust, the retiring
Relevant Trustee and each successor Relevant Trustee with respect to the Trust
Securities shall execute and deliver an instrument hereto wherein each successor
Relevant Trustee shall accept such appointment and which shall contain such
provisions as shall be necessary or desirable to transfer and confirm to, and to
vest in, each successor Relevant Trustee all the rights, powers, trusts and
duties of the retiring Relevant Trustee with respect to the Trust Securities and
the Trust and, upon the execution and delivery of such instrument, the
resignation or removal of the retiring Relevant Trustee shall become effective
to the extent provided therein and each such successor Relevant Trustee, without
any further act, deed or conveyance, shall become vested with all the rights,
powers, trusts and duties of the retiring Relevant Trustee with respect to the
Trust Securities and the Trust, but, on request of the Trust or any successor
Relevant Trustee such retiring Relevant Trustee shall upon payment
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of its charges hereunder, duly assign, transfer and deliver to such successor
Relevant Trustee all Trust Property, all proceeds thereof and money held by such
retiring Relevant Trustee hereunder with respect to the Trust Securities and the
Trust.
(b) Upon request of any such successor Relevant Trustee, the Trust
shall execute any and all instruments for more fully and certainly vesting in
and confirming to such successor Relevant Trustee all such rights, powers and
trusts referred to in the immediately preceding paragraph, as the case may be.
(c) No successor Relevant Trustee shall accept its appointment unless
at the time of such acceptance such successor Relevant Trustee shall be
qualified and eligible under this Article VIII.
SECTION 812. MERGER, CONVERSION, CONSOLIDATION OR SUCCESSION TO BUSINESS.
Any Person into which the Property Trustee or the Delaware Trustee may
be merged or converted or with which it may be consolidated, or any Person
resulting from any merger, conversion or consolidation to which such Relevant
Trustee shall be a party, or any corporation succeeding to all or substantially
all the corporate trust business of such Relevant Trustee, shall be the
successor of such Relevant Trustee hereunder, provided such Person shall be
otherwise qualified and eligible under this Article VIII, without the execution
or filing of any paper or any further act on the part of any of the parties
hereto.
SECTION 813. PREFERENTIAL COLLECTION OF CLAIMS AGAINST DEPOSITOR OR
TRUST.
If and when the Property Trustee shall be or become a creditor of the
Depositor or the Trust (or any other obligor upon the Debentures or the Trust
Securities), the Property Trustee shall be subject to and shall take all actions
necessary in order to comply with the provisions of the Trust Indenture Act
regarding the collection of claims against the Depositor or Trust (or any such
other obligor).
SECTION 814. REPORTS BY PROPERTY TRUSTEE.
(a) The Property Trustee shall transmit to Securityholders such reports
concerning the Property Trustee and its actions under this Trust Agreement as
may be required pursuant to the Trust Indenture Act at the times and in the
manner provided pursuant thereto. If required by Section 313(a) of the Trust
Indenture Act, the Property Trustee shall, within sixty days after each May 15
following the date of the Trust Agreement, deliver to Securityholders a brief
report, dated as of such May 15, which complies with the provisions of such
Section 313(a).
(b) A copy of each such report shall, at the time of such transmission
to Holders, be filed by the Property Trustee with The Nasdaq Stock Market's
National Market, and each national securities exchange or other organization
upon which the Trust Securities are listed, and also with
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the Commission so long as the Preferred Securities are registered under the
Exchange Act and the Depositor.
SECTION 815. REPORTS TO THE PROPERTY TRUSTEE.
The Depositor and the Administrative Trustees on behalf of the Trust
shall provide to the Property Trustee such documents, reports and information as
required by Section 314 of the Trust Indenture Act (if any) and the compliance
certificate required by Section 314(a) of the Trust Indenture Act in the form in
the manner and at the times required by Section 314 of the Trust Indenture Act.
Delivery of such reports, information and documents to the Property
Trustee is for information purposes only and the Property Trustee's receipt of
such shall not constitute constructive notice of any information contained
therein or determinable from information contained therein, including the
Depositor's compliance with any of its covenants hereunder (as to which the
Property Trustee is entitled to rely exclusively on Officers' Certificates).
SECTION 816. EVIDENCE OF COMPLIANCE WITH CONDITIONS PRECEDENT.
Each of the Depositor and the Administrative Trustees on behalf of the
Trust shall provide to the Property Trustee such evidence of compliance with any
conditions precedent, if any, provided for in this Trust Agreement that relate
to any of the matters set forth in Section 314(c) of the Trust Indenture Act.
Any certificate or opinion required to be given by an officer pursuant to
Section 314(c)(1) of the Trust Indenture Act shall be given in the form of an
Officers' Certificate.
SECTION 817. NUMBER OF TRUSTEES.
(a) The number of Trustees shall be five, provided that the Holder of
all of the Common Securities by written instrument may increase or decrease the
number of Administrative Trustees. The Property Trustee and the Delaware Trustee
may be the same Person.
(b) If a Trustee ceases to hold office for any reason and the number of
Administrative Trustees is not reduced pursuant to Section 817(a), or if the
number of Trustees is increased pursuant to Section 817(a), a vacancy shall
occur. The vacancy shall be filled with a Trustee appointed in accordance with
Section 810.
(c) The death, resignation, retirement, removal, bankruptcy,
incompetence or incapacity to perform the duties of a Trustee shall not operate
to dissolve, terminate or annul the Trust. Whenever a vacancy in the number of
Administrative Trustees shall occur, until such vacancy is filled by the
appointment of an Administrative Trustee in accordance with Section 810, the
Administrative Trustees in office, regardless of their number (and
notwithstanding any other provision of this Trust Agreement), shall have all the
powers granted to the Administrative
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Trustees and shall discharge all the duties imposed upon the Administrative
Trustees by this Trust Agreement.
SECTION 818. DELEGATION OF POWER.
(a) Any Administrative Trustee may, by power of attorney consistent
with applicable law, delegate to any other natural person over the age of 21 his
or her power for the purpose of executing any documents contemplated in Section
207(a); and
(b) The Administrative Trustees shall have power to delegate from time
to time to such of their number or to the Depositor the doing of such things and
the execution of such instruments either in the name of the Trust or the names
of the Administrative Trustees or otherwise as the Administrative Trustees may
deem expedient, to the extent such delegation is not prohibited by applicable
law or contrary to the provisions of the Trust, as set forth herein.
SECTION 819. VOTING.
Except as otherwise provided in this Trust Agreement, the consent or
approval of the Administrative Trustees shall require consent or approval by not
less than a majority of the Administrative Trustees, unless there are only two,
in which case both must consent.
ARTICLE IX
DISSOLUTION, LIQUIDATION AND MERGER
SECTION 901. DISSOLUTION UPON EXPIRATION DATE.
Unless earlier dissolved, the Trust shall automatically dissolve on
December 31, 2028 (the "Expiration Date").
SECTION 902. EARLY DISSOLUTION.
The first to occur of any of the following events is an "Early
Termination Event" upon the occurrence of which the Trust shall be dissolved:
(a) the occurrence of a Bankruptcy Event in respect of, or the
dissolution or liquidation of, the Depositor;
(b) delivery of written direction to the Property Trustee by the
Depositor at any time (which direction is wholly optional and within the
discretion of the Depositor) to dissolve the Trust and, after satisfaction of
liabilities to creditors of the Trust as provided by applicable law, distribute
the Debentures to Securityholders in exchange for the Preferred Securities in
accordance with Section 904;
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(c) the redemption of all of the Preferred Securities in connection
with the redemption of all of the Debentures; and
(d) an order for dissolution of the Trust shall have been entered by a
court of competent jurisdiction.
SECTION 903. TERMINATION.
The respective obligations and responsibilities of the Trustees and the
Trust created and continued hereby shall terminate upon the latest to occur of
the following: (a) the distribution by the Property Trustee to Securityholders
upon the liquidation of the Trust pursuant to Section 904, or upon the
redemption of all of the Trust Securities pursuant to Section 402, of all
amounts required to be distributed hereunder upon the final payment of the Trust
Securities; (b) the payment of any expenses owed by the Trust; (c) the discharge
of all administrative duties of the Administrative Trustees, including the
performance of any tax reporting obligations with respect to the Trust or the
Securityholders; and (d) the filing of a Certificate of Cancellation by the
Administrative Trustees under the Delaware Business Trust Act.
SECTION 904. LIQUIDATION.
(a) If an Early Termination Event specified in clause (a), (b), or (d)
of Section 902 occurs or upon the Expiration Date, the Trust shall be liquidated
by the Trustees as expeditiously as the Trustees determine to be possible by
distributing, after satisfaction of liabilities to creditors of the Trust as
provided by applicable law, to each Securityholder a Like Amount of Debentures,
subject to Section 904(d). Notice of liquidation shall be given by the Property
Trustee by first-class mail, postage prepaid, mailed not later than 30 nor more
than 60 days prior to the Liquidation Date to each Holder of Trust Securities at
such Holder's address appearing in the Securities Register. All notices of
liquidation shall:
(i) state the Liquidation Date;
(ii) state that from and after the Liquidation Date, the
Trust Securities shall no longer be deemed to be Outstanding and any
Trust Securities Certificates not surrendered for exchange shall be
deemed to represent a Like Amount of Debentures;
(iii) provide such information with respect to the mechanics
by which Holders may exchange Trust Securities Certificates for
Debentures, or, if Section 904(d) applies, receive a Liquidation
Distribution, as the Administrative Trustees shall deem appropriate;
(iv) state the CUSIP number; and
(v) state the office or agency of the Trust where Trust
Securities should be surrendered.
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(b) Except where Section 902(c) or 904(d) applies, in order to effect
the liquidation of the Trust and distribution of the Debentures to
Securityholders, the Property Trustee shall establish a record date for such
distribution (which shall be not more than 45 days prior to the Liquidation
Date) and, either itself acting as exchange agent or through the appointment of
a separate exchange agent, shall establish such procedures as it shall deem
appropriate to effect the distribution of Debentures in exchange for the
Outstanding Trust Securities Certificates.
(c) Except where Section 902(c) or 904(d) applies, after the
Liquidation Date, (i) the Trust Securities shall no longer be deemed to be
Outstanding; (ii) certificates representing a Like Amount of Debentures shall be
issued to holders of Trust Securities Certificates upon surrender of such
certificates to the Administrative Trustees or their agent for exchange; (iii)
the Depositor shall use its reasonable efforts to have the Debentures listed on
The Nasdaq Stock Market's National Market or SmallCap Market or on such other
securities exchange or other organization as the Preferred Securities are then
listed or traded; (iv) any Trust Securities Certificates not so surrendered for
exchange shall be deemed to represent a Like Amount of Debentures, accruing
interest at the rate provided for in the Debentures from the last Distribution
Date on which a Distribution was made on such Trust Securities Certificates
until such certificates are so surrendered (and until such certificates are so
surrendered, no payments of interest or principal shall be made to Holders of
Trust Securities Certificates with respect to such Debentures): and (v) all
rights of Securityholders holding Trust Securities shall cease, except the right
of such Securityholders to receive Debentures upon surrender of Trust Securities
Certificates.
(d) In the event that, notwithstanding the other provisions of this
Section 904, whether because of an order for dissolution entered by a court of
competent jurisdiction or otherwise, distribution of the Debentures in the
manner provided herein is determined by the Administrative Trustees not to be
practical, the Trust Property shall be liquidated, and the Trust shall be
wound-up or terminated, by the Property Trustee in such manner as the Property
Trustee determines. In such event, Securityholders shall be entitled to receive
out of the assets of the Trust available for distribution to Securityholders,
after satisfaction of liabilities to creditors of the Trust as provided by
applicable law, an amount equal to the Liquidation Amount per Trust Security
plus accumulated and unpaid Distributions thereon to the date of payment (such
amount being the "Liquidation Distribution"). If, upon any such winding-up or
termination, the Liquidation Distribution can be paid only in part because the
Trust has insufficient assets available to pay in full the aggregate Liquidation
Distribution, then, subject to the next succeeding sentence, the amounts payable
by the Trust on the Trust Securities shall be paid on a pro rata basis (based
upon Liquidation Amounts). The Holder of the Common Securities shall be entitled
to receive Liquidation Distributions upon any such winding-up or termination pro
rata (determined as aforesaid) with Holders of Preferred Securities, except
that, if a Debenture Event of Default has occurred and is continuing, the
Preferred Securities shall have a priority over the Common Securities.
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SECTION 905. MERGERS, CONSOLIDATIONS, AMALGAMATIONS OR REPLACEMENTS OF THE
TRUST.
The Trust may not merge with or into, consolidate, amalgamate, or be
replaced by, or convey, transfer or lease its properties and assets
substantially as an entirety to any Person, except pursuant to this Section 905
or Section 904. At the request of the Depositor, with the consent of the
Administrative Trustees and without the consent of the Holders of the Preferred
Securities, the Property Trustee or the Delaware Trustee, the Trust may merge
with or into, consolidate, amalgamate, be replaced by or convey, transfer or
lease its properties and assets substantially as an entirety a trust organized
as such under the laws of any state; provided, that (i) such successor entity
either (a) expressly assumes all of the obligations of the Trust with respect to
the Preferred Securities; or (b) substitutes for the Preferred Securities other
securities having substantially the same terms as the Preferred Securities (the
"Successor Securities") so long as the Successor Securities rank the same as the
Preferred Securities rank in priority with respect to distributions and payments
upon liquidation, redemption and otherwise; (ii) the Depositor expressly
appoints a trustee of such successor entity possessing substantially the same
powers and duties as the Property Trustee as the holder of the Debentures; (iii)
the Successor Securities are registered or listed, or any Successor Securities
shall be registered or listed upon notification of issuance, on any national
securities exchange or other organization on which the Preferred Securities are
then registered or listed (including, if applicable, The Nasdaq Stock Market's
National Market), if any; (iv) such merger, consolidation, amalgamation,
replacement, conveyance, transfer or lease does not cause the Preferred
Securities (including any Successor Securities) to be downgraded by any
nationally recognized statistical rating organization, (v) such merger,
consolidation, amalgamation, replacement, conveyance, transfer or lease does not
adversely affect the rights, preferences and privileges of the holders of the
Preferred Securities (including any Successor Securities) in any material
respect; (vi) such successor entity has a purpose substantially identical to
that of the Trust, (vii) prior to such merger, consolidation, amalgamation,
replacement, conveyance, transfer or lease, the Depositor has received an
Opinion of Counsel to the effect that (a) such merger, consolidation,
amalgamation, replacement, conveyance, transfer or lease does not adversely
affect the rights, preferences and privileges of the Holders of the Preferred
Securities (including any Successor Securities) in any material respect: and (b)
following such merger, consolidation, amalgamation, replacement, conveyance,
transfer or lease, neither the Trust nor such successor entity shall be required
to register as an "investment company" under the Investment Company Act, and
(viii) the Depositor or any permitted successor or assignee owns all of the
common securities of such successor entity and guarantees the obligations of
such successor entity under the Successor Securities at least to the extent
provided by the Guarantee. Notwithstanding the foregoing, the Trust shall not,
except with the consent of Holders of 100% in Liquidation Amount of the
Preferred Securities, consolidate, amalgamate, merge with or into, or be
replaced by or convey, transfer or lease its properties and assets substantially
as an entirety to any other Person or permit any other Person to consolidate,
amalgamate, merge with or into, or replace it if such consolidation,
amalgamation, merger, replacement, conveyance, transfer or lease would cause the
Trust or the successor entity to be classified as other than a grantor trust for
United States federal income tax purposes.
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ARTICLE X
MISCELLANEOUS PROVISIONS
SECTION 1001. LIMITATION OF RIGHTS OF SECURITYHOLDERS.
The death, incapacity, dissolution, bankruptcy or termination of any
Person having an interest, beneficial or otherwise, in Trust Securities shall
not operate to terminate this Trust Agreement, nor dissolve, terminate or annul
the Trust, nor entitle the legal representatives or heirs of such Person or any
Securityholder for such Person, to claim an accounting, take any action or bring
any proceeding in any court for a partition or winding-up of the arrangements
contemplated hereby, nor otherwise affect the rights, obligations and
liabilities of the parties hereto or any of them.
SECTION 1002. AMENDMENT.
(a) This Trust Agreement may be amended from time to time by the
Trustees and the Depositor, without the consent of any Securityholders, (i) as
provided in Section 811 with respect to acceptance of appointment by a successor
Trustee; (ii) to cure any ambiguity, correct or supplement any provision herein
or therein which may be inconsistent with any other provision herein or therein,
or to make any other provisions with respect to matters or questions arising
under this Trust Agreement, that shall not be inconsistent with the other
provisions of this Trust Agreement; or (iii) to modify, eliminate or add to any
provisions of this Trust Agreement to such extent as shall be necessary to
ensure that the Trust shall be classified for United States federal income tax
purposes as a grantor trust at all times that any Trust Securities are
Outstanding or to ensure that the Trust shall not be required to register as an
"investment company" under the Investment Company Act; provided, however, that
in the case of clause (ii), such action shall not adversely affect in any
material respect the interests of any Securityholder, and any such amendments of
this Trust Agreement shall become effective when notice thereof is given to the
Securityholders.
(b) Except as provided in Section 601(c) or Section 1002(c) hereof, any
provision of this Trust Agreement may be amended by the Trustees and the
Depositor (i) with the consent of Trust Securityholders representing not less
than a majority (based upon Liquidation Amounts) of the Trust Securities then
Outstanding; and (ii) upon receipt by the Trustees of an Opinion of Counsel to
the effect that such amendment or the exercise of any power granted to the
Trustees in accordance with such amendment shall not affect the Trust's status
as a grantor trust for United Status federal income tax purposes or the Trust's
exemption from status of an "investment company" under the Investment Company
Act.
(c) In addition to and notwithstanding any other provision in this
Trust Agreement, without the consent of each affected Securityholder (such
consent being obtained in accordance with Section 603 or 606 hereof), this Trust
Agreement may not be amended to (i) change the amount or timing of any
Distribution on the Trust Securities or otherwise adversely affect the amount of
any Distribution required to be made in respect of the Trust Securities as of a
specified
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date; or (ii) restrict the right of a Securityholder to institute suit for the
enforcement of any such payment on or after such date; notwithstanding any other
provision herein, without the unanimous consent of the Securityholders (such
consent being obtained in accordance with Section 603 or 606 hereof), this
paragraph (c) of this Section 1002 may not be amended.
(d) Notwithstanding any other provisions of this Trust Agreement, no
Trustee shall enter into or consent to any amendment to this Trust Agreement
which would cause the Trust to fail or cease to qualify for the exemption from
status of an "investment company" under the Investment Company Act or to fail or
cease to be classified as a grantor trust for United States federal income tax
purposes.
(e) In the event that any amendment to this Trust Agreement is made,
the Administrative Trustees shall promptly provide to the Depositor a copy of
such amendment.
(f) Neither the Property Trustee nor the Delaware Trustee shall be
required to enter into any amendment to this Trust Agreement which affects its
own rights, duties or immunities under this Trust Agreement. The Property
Trustee shall be entitled to receive an Opinion of Counsel and an Officers'
Certificate stating that any amendment to this Trust Agreement is in compliance
with this Trust Agreement.
SECTION 1003. SEPARABILITY.
In case any provision in this Trust Agreement or in the Trust
Securities Certificates shall be invalid, illegal or unenforceable, the
validity, legality and enforceability of the remaining provisions shall not in
any way be affected or impaired thereby.
SECTION 1004. GOVERNING LAW.
THIS TRUST AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF EACH OF THE
SECURITYHOLDERS, THE TRUST AND THE TRUSTEES WITH RESPECT TO THIS TRUST AGREEMENT
AND THE TRUST SECURITIES SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY
THE LAWS OF THE STATE OF DELAWARE (WITHOUT REGARD TO CONFLICT OF LAWS
PRINCIPLES).
SECTION 1005. PAYMENTS DUE ON NON-BUSINESS DAY.
If the date fixed for any payment on any Trust Security shall be a day
that is not a Business Day, then such payment need not be made on such date but
may be made on the next succeeding day which is a Business Day (except as
otherwise provided in Sections 401(a) and 402(d)), with the same force and
effect as though made on the date fixed for such payment, and no distribution
shall accumulate thereon for the period after such date.
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SECTION 1006. SUCCESSORS.
This Trust Agreement shall be binding upon and shall inure to the
benefit of any successor to the Depositor, the Trust or the Relevant Trustee(s),
including any successor by operation of law. Except as contemplated by Article
XII of the Indenture and pursuant to which the assignee agrees in writing to
perform the Depositor's obligations hereunder, the Depositor shall not assign
its obligations hereunder.
SECTION 1007. HEADINGS.
The Article and Section headings are for convenience only and shall not
affect the construction of this Trust Agreement.
SECTION 1008. REPORTS, NOTICES AND DEMANDS.
Any report, notice, demand or other communication which by any
provision of this Trust Agreement is required or permitted to be given or served
to or upon any Securityholder or the Depositor may be given or served in writing
by deposit thereof, first-class postage prepaid, in the United States mail, hand
delivery or facsimile transmission, in each case, addressed, (a) in the case of
a Preferred Securityholder, to such Preferred Securityholder as such
Securityholder's name and address may appear on the Securities Register; and (b)
in the case of the Common Securityholder or the Depositor, to American
Bancorporation, 1025 Main Street, Suite 800, Wheeling, WV 26003, Attention:
Chairman of the Board and Chief Executive Officer, facsimile no.: (304)
233-5006. Such notice, demand or other communication to or upon a Securityholder
shall be deemed to have been sufficiently given or made, for all purposes, upon
hand delivery, mailing or transmission.
Any notice, demand or other communication which by any provision of
this Trust Agreement is required or permitted to be given or served to or upon
the Trust, the Property Trustee, the Delaware Trustee or the Administrative
Trustees shall be given in writing addressed (until another address is published
by the Trust) as follows: (a) with respect to the Property Trustee to The Bank
of New York, 101 Barclay Street, 21W, New York, New York 10286, Attention:
Corporate Trust Trustee Administration; (b) with respect to the Delaware
Trustee, to The Bank of New York (Delaware), c/o The Bank of New York, 101
Barclay Street, Floor 21 West, New York, New York 10286; and (c) with respect to
the Administrative Trustees, to them at the address above for notices to the
Depositor, marked "Attention: Administrative Trustees of American Bancorporation
Capital Trust I." Such notice, demand or other communication to or upon the
Trust, the Administrative Trustees, the Delaware Trustee or the Property Trustee
shall be deemed to have been sufficiently given or made only upon actual receipt
of the writing by the Trust, the Administrative Trustees, the Delaware Trustee
or the Property Trustee.
SECTION 1009. AGREEMENT NOT TO PETITION.
Each of the Trustees and the Depositor agree for the benefit of the
Securityholders that, until at least one year and one day after the Trust has
been dissolved in accordance with Article
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IX, they shall not file, or join in the filing of, a petition against the Trust
under any bankruptcy, insolvency, reorganization or other similar law
(including, without limitation, the United States Bankruptcy Code of 1978, as
amended) (collectively, "Bankruptcy Laws") or otherwise join in the commencement
of any proceeding against the Trust under any Bankruptcy Law. In the event the
Depositor takes action in violation of this Section 1009, the Property Trustee
agrees, for the benefit of Securityholders, that at the expense of the Depositor
(which expense shall be paid prior to the filing), it shall file an answer with
the bankruptcy court or otherwise properly contest the filing of such petition
by the Depositor against the Trust or the commencement of such action and raise
the defense that the Depositor has agreed in writing not to take such action and
should be stopped and precluded therefrom. The provisions of this Section 1009
shall survive the termination of this Trust Agreement.
SECTION 1010. TRUST INDENTURE ACT; CONFLICT WITH TRUST INDENTURE ACT.
(a) This Trust Agreement is subject to the provisions of the Trust
Indenture Act that are required to be part of this Trust Agreement and shall, to
the extent applicable, be governed by such provisions.
(b) The Property Trustee shall be the only Trustee which is a trustee
for the purposes of the Trust Indenture Act.
(c) If any provision hereof limits, qualifies or conflicts with another
provision hereof which is required to be included in this Trust Agreement by any
of the provisions of the Trust Indenture Act, such required provision shall
control. If any provision of this Trust Agreement modifies or excludes any
provision of the Trust Indenture Act which may be so modified or excluded, the
latter provision shall be deemed to apply to this Trust Agreement as so modified
or to be excluded, as the case may be.
(d) The application of the Trust Indenture Act to this Trust Agreement
shall not affect the nature of the Trust Securities as equity securities
representing undivided beneficial interests in the assets of the Trust.
SECTION 1011. ACCEPTANCE OF TERMS OF TRUST AGREEMENT, GUARANTEE AND INDENTURE.
THE RECEIPT AND ACCEPTANCE OF A TRUST SECURITY OR ANY INTEREST THEREIN BY
OR ON BEHALF OF A SECURITYHOLDER OR ANY BENEFICIAL OWNER, WITHOUT ANY SIGNATURE
OR FURTHER MANIFESTATION OF ASSENT, SHALL CONSTITUTE THE UNCONDITIONAL
ACCEPTANCE BY THE SECURITYHOLDER AND ALL OTHERS HAVING A BENEFICIAL INTEREST IN
SUCH TRUST SECURITY OF ALL THE TERMS AND PROVISIONS OF THIS TRUST AGREEMENT AND
AGREEMENT TO THE SUBORDINATION PROVISIONS AND OTHER TERMS OF THE GUARANTEE AND
THE INDENTURE, AND SHALL CONSTITUTE THE AGREEMENT OF THE TRUST, SUCH
SECURITYHOLDER AND SUCH OTHERS THAT THE TERMS AND PROVISIONS OF THIS TRUST
AGREEMENT SHALL BE BINDING, OPERATIVE AND EFFECTIVE AS AMONG THE TRUST AND SUCH
SECURITYHOLDER AND SUCH OTHERS.
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<PAGE>
AMERICAN BANCORPORATION
By:
-------------------------------------------------------
Name: Jeremy C. McCamic
Title: Chairman of the Board and Chief Executive Officer
THE BANK OF NEW YORK, AS PROPERTY TRUSTEE
By:
------------------------------------------------------
Name:
---------------------------------------------------
Title:
---------------------------------------------------
THE BANK OF NEW YORK (DELAWARE),
AS DELAWARE TRUSTEE
By:
------------------------------------------------------
Name:
---------------------------------------------------
Title:
---------------------------------------------------
ADMINISTRATIVE TRUSTEES
By:
--------------------------------------------------------
Name: Jeremy C. McCamic
Title: As Administrative Trustee
By:
--------------------------------------------------------
Name: Paul W. Donahic
Title: As Administrative Trustee
By:
--------------------------------------------------------
Name: Brent E. Richmond
Title: As Administrative Trustee
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<PAGE>
EXHIBIT A
CERTIFICATE OF TRUST
OF
AMERICAN BANCORPORATION CAPITAL TRUST I
THIS CERTIFICATE OF TRUST of American Bancorporation Capital Trust I
(the "Trust"), dated as of March 11, 1998, is being duly executed and filed by
the undersigned, as trustees, to form a business trust under the Delaware
Business Trust Act (12 Del. C. ss. 3801, et seq.).
1. Name. The name of the business trust being formed hereby is
American Bancorporation Capital Trust I.
2. Delaware Trustee. The name and business address of the trustee of
the Trust with a principal place of business in the State of Delaware are The
Bank of New York (Delaware), White Clay Center, Route 273, Newark, Delaware
19711.
3. Effective Date. This Certificate of Trust shall be effective upon
filing.
IN WITNESS WHEREOF, the undersigned, being the trustees of the Trust,
have executed this Certificate of Trust as of the date first-above written.
THE BANK OF NEW YORK,
as Property Trustee
By: /s/ Mary Beth Lewicki
------------------------------------
Name: Mary Beth Lewicki
Title: Assistant Vice President
THE BANK OF NEW YORK (DELAWARE),
as Delaware Trustee
By: /s/ Mary Jane Morrisey
------------------------------------
Name: Mary Jane Morrisey
Title: Authorized Signatory
/s/ Jeremy C. McCamic
----------------------------------------
JEREMY C. McCAMIC
as Administrative Trustee
/s/ Paul W. Donahie
PAUL W. DONAHIE
----------------------------------------
as Administrative Trustee
/s/ Brent E. Richmond
BRENT E. RICHMOND
----------------------------------------
as Administrative Trustee
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<PAGE>
EXHIBIT B
BOOK-ENTRY-ONLY CORPORATE EQUITY ISSUES
LETTER OF REPRESENTATIONS
(To be Completed by Issuer and Agent)
American Bancorporation Capital Trust I
------------------------------------------------------------------
(Name of Issuer)
The Bank of New York
------------------------------------------------------------------
(Name of Agent)
April __, 1998
Attention: General Counsel's Office
THE DEPOSITORY TRUST COMPANY
55 Water Street; 49th Floor
New York, NY 10041-0099
Re: American Bancorporation Capital Trust I
__% Cumulative Trust Preferred Securities dues 2028
CUSIP number: 024075-20-2
(Issue Description including CUSIP number)
Ladies and Gentlemen:
This letter sets forth our understanding with respect to certain
matters relating to the above-referenced issue (the "Securities"). Issuer is
selling the Securities to Legg Mason Wood Walker Incorporated (the "Initial
Purchaser") pursuant to an Underwriting Agreement dated April __, 1998 (the
"Document"). Initial Purchaser will take delivery of the Securities through The
Depository Trust Company ("DTC"). The Bank of New York is acting as transfer
agent, paying agent, and registrar with respect to the Securities (the "Agent").
To induce DTC to accept the Securities as eligible for deposit at DTC,
and to act in accordance with its Rules with respect to the Securities, Issuer
and Agent make the following representations to DTC:
1. Prior to closing on the Securities on April __, 1998, there shall be
deposited with DTC one Security certificate registered in the name of DTC's
nominee, Cede & Co., for each of the Securities with the offering value set
forth on Schedule A hereto, the total of which represents 100% of the offering
value of such Securities. If, however, the offering value of any Security
exceeds $200 million, one certificate will be issued with respect to each $200
million of offering value and an additional certificate will be issued with
respect to any remaining offering value. Each Security certificate shall bear
the following legend:
"Unless this certificate is presented by an authorized representative
of The Depository Trust Company, a New York corporation ("DTC"), to
Issuer or its
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<PAGE>
agent for registration of transfer, exchange, or payment, and any
certificate issued is registered in the name of Cede & Co. or in such
other name as is requested by an authorized representative of DTC (and
any payment is made to Cede & Co. or to such other entity as is
requested by an authorized representative of DTC), ANY TRANSFER,
PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY ANY PERSON IS
WRONGFUL inasmuch as the registered over hereof, Cede & Co., has an
interest herein."
If the Securities will be held by Agent, as custodian for DTC, such Security
certificate shall remain in Agent's custody pursuant to the provisions of the
FAST Balance Certificate Agreement currently in effect between Agent and DTC.
2. Issuer: (a) understands that DTC has no obligation to, and will not,
communicate to its Participants or to any person having an interest in the
Securities any information contained in the Security certificate(s), and (b)
acknowledges that neither DTC's Participants nor any person having an interest
in the Securities shall be deemed to have notice of the provisions of the
Security certificate(s) by virtue of submission of such certificate(s) to DTC.
3. In the event of any solicitation of consents from or voting by
holders of the Securities, Issuer or Agent shall establish a record date for
such purposes (with no provision for revocation of consents or votes by
subsequent holders and shall send notice of such record date to DTC not less
than 15 calendar days in advance of such record date. Notices to DTC pursuant to
this Paragraph by telecopy shall be sent to DTC's Reorganization Department at
(212) 709-6896 or (212) 709-6897, and receipt of such notices shall be confirmed
by telephoning (212) 709-6870. Notices to DTC pursuant to this Paragraph by mail
or by any other means shall be sent to DTC's Reorganization Department as
indicated in Paragraph 7.
4. In the event of a stock split, recapitalization, conversion, or any
similar transaction resulting in the cancellation of all or any part of the
Securities represented hereby, the Agent shall send DTC a notice of such event
as soon as practicable, but in no event less than five business days prior to
the effective date of such transaction.
5. In the event of a full or partial redemption, Issuer or Agent shall
send a notice to DTC specifying: (a) the amount of the redemption or refunding;
(b) in the case of a refunding, the maturity date(s) established under the
refunding; and (c) the date such notice is to be distributed to security holders
or published (the "Publication Date"). Such notice shall be sent to DTC by a
secure means (e.g., legible telecopy, registered or certified mail, overnight
delivery) in a timely manner designed to assure that such notice is in DTC's
possession no later than the close of business on the business day before or, if
possible, five business days before the Publication Date, Issuer or Agent shall
forward such notice either in a separate secure transmission for each CUSIP
number or in a secure transmission for multiple CUSIP numbers (if applicable)
which includes a manifest or list of each CUSIP number submitted in that
transmission. (The party sending such notice shall have a method to verify
subsequently the use of such means and the timeliness of such notice.) The
Publication Date shall be not less than 30 days nor more than 60
-60-
<PAGE>
days prior to the redemption date, or in the case of an advance refunding, the
date that the proceeds are deposited in escrow. Notices to DTC pursuant to this
Paragraph by telecopy shall be sent to DTC's Call Notification Department at
(516) 227-4039 or (516) 227-4190. If the party sending the notice does not
receive a telecopy receipt from DTC confirming that the notice has been
received, such party shall telephone (516) 227-4070. Notices to DTC pursuant to
this Paragraph by mail or by any other means shall be sent to:
Manager, Call Notification Department
The Depository Trust Company
711 Stewart Avenue
Garden City, NY 11530-4719
6. In the event of an offering or issuance of rights with respect to
the Securities outstanding, Agent shall send DTC's Dividend and Reorganization
Departments a notice specifying: (a) the amount of and conditions, if any,
applicable to such rights offering or issuance; (b) any applicable expiration or
deadline date, or any date by which action on the part of holders of such
Securities is required; and (c) the Publication Date of such notice.
The Publication Date will be as soon as practicable after the
announcement by the Company of any such offering or issuance of rights with
respect to the Securities represented thereby, DTC requires that the Publication
Date be not less than 30 days nor more than 60 days prior to the related payment
date, distribution date, or issuance date, respectively.
Notices to DTC pursuant to this Paragraph by telecopy shall be sent to
DTC's Dividend Department at (212) 709-1623, and receipt of such notices shall
be confirmed by telephoning (212) 709-1282. Notices to DTC pursuant to the above
by mail or any other means shall be sent to:
Supervisor, Stock Dividends
Dividend Department
7 Hanover Square, 24th Floor
New York, NY 10004-2695
Notices to DTC pursuant to this Paragraph by telecopy shall be sent to
DTC's Reorganization Department at (212) 709-1093, and receipt of such fax shall
be confirmed by telephoning (212) 709-1063. Notices to DTC pursuant to the above
by mail or any other means shall be sent to:
Supervisor, Rights Offerings
Reorganization Department
7 Hanover Square, 23rd Floor
New York, NY 10004-2695
7. In the event of an invitation to tender the Securities (including
mandatory tenders, exchanges, and capital changes), notice by Issuer or Agent to
Security holders specifying the terms of the tender and the Publication Date of
such notice shall be sent to DTC by a secure
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<PAGE>
means in the manner set forth in Paragraph 5. Notice to DTC pursuant to this
Paragraph and notices of other corporate actions by telecopy shall be sent to
DTC's Reorganization Department at (212) 709-1093 or (212) 709-1094, and receipt
of such notices shall be confirmed by telephoning (212) 709-6884. Notices to DTC
pursuant to the above by mail or by any other means shall be sent to:
Manager, Reorganization Department
Reorganization Window
The Depository Trust Company
7 Hanover Square, 23rd Floor
New York, NY 10004-2695
8. All notices and payment advices sent to DTC shall contain the CUSIP
number of the Securities (listed on Schedule A hereto) and the accompanying
description of such Securities, which, as of the date of this letter, is ___%
Cumulative Trust Preferred Securities.
9. Issuer or Agent shall provide written notice of dividend payment
information to a standard dividend announcement service subscribed to by DTC as
soon as the information is available. In the event that no such service exists,
Issuer or Agent shall provide such notice directly to DTC electronically as
previously arranged by Issuer or Agent and DTC, as soon as the payment
information is available. If electronic transmission has not been arranged,
absent any other arrangements between Issuer or Agent and DTC, such information
should be sent by telecopy to DTC's Dividend Department at (212) 709-1723 or
(212) 709-1686, and receipt of such notices shall be confirmed by telephoning
(212) 709-1270. Notices to DTC pursuant to the above by mail or by any other
means shall be sent to:
Manager, Announcements
Dividend Department
The Depository Trust Company
7 Hanover Square, 22nd Floor
New York, NY 10004-2695
After establishing the amount of payment to be made on the Securities
in question, Issuer or Agent will notify DTC's Dividend Department of the
payment and payment date preferably five, but not less than two, business days
prior to the effective date for such transaction.
10. Issuer or Agent shall provide CUSIP-level detail for dividend
payments to DTC no later than noon (Eastern Time) on the payment date.
11. Dividend payments and cash distribution shall be received by Cede &
Co., as nominee of DTC, or its registered assigns, in same-day funds no later
that 2:30 p.m. (Eastern Time) on payment date. Absent any other arrangements
between Issuer or Agent and DTC, such funds shall be wired as follows:
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<PAGE>
The Chase Manhattan Bank
ABA # 021 000 021
For credit to a/c Cede & Co.
c/o The Depository Trust Company
Dividend Deposit Account # 066-026776
12. Redemption payments shall be received by Cede & Co., as nominee of
DTC, or its registered assigns, in same-day funds no later than 2:30 p.m.
(Eastern Time) on payment date. Absent any other arrangement between Agent and
DTC, such funds shall be wired as follows:
The Chase Manhattan Bank
ABA # 021 000 021
For credit to a/c Cede & Co.
c/o The Depository Trust Company
Redemption Deposit Account # 066-027306
13. Reorganization payments resulting from corporate actions (such as
tender offers or mergers) shall be received by Cede & Co., as nominee of DTC, or
its registered assigns, in same-day funds no later than 2:30 p.m. (Eastern Time)
on payment date. Absent any other arrangements between Agent and DTC, such funds
shall be wired as follows:
The Chase Manhattan Bank
ABA # 021 000 021
For credit to a/c Cede & Co.
c/o The Depository Trust Company
Reorganization Deposit Account # 066-027608
14. DTC may direct Issuer or Agent to use any other number or address
as the number or address to which notices or payments of dividends,
distributions, or redemption proceeds may be sent.
15. In the event of a redemption, acceleration, or any other similar
transaction (e.g., tender made and accepted in response to Issuer's or Agent's
invitation) necessitating a reduction in the aggregate principal amount of
Securities outstanding or an advance refunding of part of the Securities
outstanding, DTC, in its discretion: (a) may request Issuer or Agent to issue
and authenticate a new Security certificate; or (b) may make an appropriate
notation on the Security certificate indicating the date and amount of such
reduction in the number of Securities outstanding, except in the case of final
redemption, in which case the certificate will be presented to Issuer or Agent
prior to payment, if required.
16. In the event that Issuer determines that beneficial owners of
Securities shall be able to obtain certified Securities, Issuer or Agent shall
notify DTC of the availability of certificates. In such event, Issuer or Agent
shall transfer and exchange certificates in appropriate amounts, as required by
DTC and others.
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<PAGE>
17. DTC may discontinue providing its services as securities depository
with respect to the Securities at any time by giving reasonable notice to Issuer
or Agent (at which time DTC will confirm with Issuer or Agent the aggregate
principal amount of Securities outstanding). Under such circumstances, at DTC's
request Issuer and Agent shall cooperate fully with DTC by taking appropriate
action to make available one or more separate certificates evidencing Securities
to any DTC Participant having Securities credited to its DTC accounts.
18. Nothing herein shall be deemed to require Agent to advance funds on
behalf of Issuer.
19. This Letter of Representations may be executed in any number of
counterparts, each of which when so executed shall be deemed to be an original,
but all such counterparts together shall constitute but one and the same
instrument.
20. This Letter of Representations is governed by, and shall be
construed in accordance with, the laws of the State of New York without giving
effect to principles of conflicts of law.
21. The following riders, attached hereto, are hereby incorporated into
this Letter of Representations:
--------------------------------------------------------------
--------------------------------------------------------------
NOTES:
A. If there is an Agent (as defined in this Letter of Representations), Agent as
well as Issuer must sign this Letter. If there is no Agent, in signing this
Letter, Issuer itself undertakes to perform all of the obligations set forth
herein.
B. Schedule B contains statements that DTC believes accurately describe DTC, the
method of effecting book-entry transfers of securities distributed through DTC,
and certain related matters.
Very truly yours,
American Bancorporation Capital Trust I
(Issuer)
By: _____________________________
(Authorized Officer's Signature)
The Bank of New York
(Agent)
By: _____________________________
(Authorized Officer's Signature)
Received and Accepted:
THE DEPOSITORY TRUST COMPANY
By: _____________________________
cc: Underwriter
Underwriter's Counsel
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<PAGE>
SCHEDULE A
----------
American Bancorporation Capital Trust I
-----------------------------------------------------------------------
_____% Cumulative Trust Preferred Securities due 2028
-----------------------------------------------------------------------
(Describe Issue)
<TABLE>
<CAPTION>
CUSIP Number Share Total Offering ($) Value
------------ ----------- ------------------
<S> <C> <C> <C>
024075-20-2 1,100,000 $11,000,000
with over allotment
1,265,000 $12,650,000
</TABLE>
<PAGE>
SCHEDULE B
----------
SAMPLE OFFERING DOCUMENT LANGUAGE
DESCRIBING BOOK-ENTRY-ONLY ISSUANCE
(Prepared by DTC--bracketed material may be applicable only to certain issues)
1. The Depository Trust Company ("DTC"), New York, NY, will act as
securities depository for the securities (the "Securities"). The Securities will
be issued as fully-registered securities registered in the name of Cede & Co.
(DTC's partnership nominee). One fully registered Security certificate will be
issued for [each issue of] the Securities [each] in the aggregate principal
amount of such issue, and will be deposited with DTC. [If, however, the
aggregate principal amount of [any] issue exceeds $200 million, one certificate
will be issued with respect to any remaining principal amount of such issue.]
2. DTC is a limited-purpose trust company organized under the New York
Banking Law, a "banking organization" within the meaning of the New York Banking
Law, a member of the Federal Reserve System, a "clearing corporation" within the
meaning of the New York Uniform Commercial Code, and a "clearing agency"
registered pursuant to the provisions of Section 17A of the Securities Exchange
Act of 1934. DTC holds securities that its participants ("Participants") deposit
with DTC. DTC also facilitates the settlement among Participants of securities
transactions, such as transfers and pledges, in deposited securities through
electronic computerized book-entry changes in Participants' accounts, thereby
eliminating the need for physical movement of securities certificates. Direct
Participants include securities brokers and dealers, banks, trust companies,
clearing corporations, and certain other organizations. DTC is owned by a number
of its Direct Participants and by the New York Stock Exchange, Inc., the
American Stock Exchange, Inc., and the National Association of Securities
Dealers, Inc. Access to the DTC system is also available to others such as
securities brokers and dealers, banks, and trust companies that clear through or
maintain a custodial relationship with a Direct Participant, either directly or
indirectly ("Indirect Participants"). The Rules applicable to DTC and its
Participants are on file with the Securities and Exchange Commission.
3. Purchases of Securities under the DTC system must be made by or
through Direct Participants, which will receive a credit for the Securities on
DTC's records. The ownership interest of each actual purchaser of each Security
("Beneficial Owner") is in turn to be recorded on the Direct and Indirect
Participants' records. Beneficial Owners will not receive written confirmation
from DTC of their purchase, but Beneficial Owners are expected to receive
written confirmations providing details of the transaction, as well as periodic
statements of their holdings, from the Direct or Indirect Participant through
which the Beneficial Owner entered into the transaction. Transfers of ownership
interests in the Securities are to be accomplished by entries made on the books
of Participants acting on behalf of Beneficial Owners. Beneficial Owners will
not receive certificates representing their ownership interests in Securities,
except in the event that use of the book-entry system for the Securities is
discontinued.
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<PAGE>
4. To facilitate subsequent transfers, all Securities deposited by
Participants with DTC are registered in the name of DTC's partnership nominee,
Cede & Co. The deposit of Securities with DTC and their registration in the name
of Cede & Co. effect no change in beneficial ownership. DTC has no knowledge of
the actual Beneficial Owners of the Securities; DTC's records reflect only the
identity of the Direct Participants to whose accounts such Securities are
credited, which may or may not be the Beneficial Owner. The Participants will
remain responsible for keeping account of their holdings on behalf of their
customers.
5. Conveyance of notices and other communications by DTC to Direct
Participants, by Direct Participants to Indirect Participants, and by Direct
Participants and Indirect Participants to Beneficial Owners will be governed by
arrangements among them, subject to any statutory or regulatory requirements as
may be in effect from time to time.
[6. Redemption notices shall be sent to DTC. If less than all of the
Securities within an issue are being redeemed, DTC's practice is to determine by
lot the amount of the interest of each Direct Participant in such issue to be
redeemed.]
7. Neither DTC nor Cede & Co. will consent or vote with respect to
Securities. Under its usual procedures, DTC mails an Omnibus Proxy to Issuer as
soon as possible after the record date. The Omnibus Proxy assigns Cede & Co.'s
consenting or voting rights to those Direct Participants to whose accounts the
Securities are credited on the record date (identified in a listing attached to
the Omnibus Proxy).
8. Redemption proceeds, distributions, and dividend payments on the
Securities will be made to Cede & Co., as nominee of DTC. DTC's practice is to
credit Direct Participants' accounts, upon DTC's receipt of funds and
corresponding detail information from Issuer or Agent on payable date in
accordance with their respective holdings shown on DTC's records. Payments by
Participants to Beneficial Owners will be governed by standing instructions and
customary practices, as is the case with securities held for the accounts of
customers in bearer form or registered in "street name," and will be the
responsibility of such Participant and not of DTC, Agent, or Issuer, subject to
any statutory or regulatory requirements as may be in effect from time to time.
Payment of redemption proceeds, distributions, and dividends to Cede & Co. is
the responsibility of Issuer or Agent, disbursement of such payments to Direct
Participants shall be the responsibility of Cede & Co., and disbursement of such
payments to the Beneficial Owners shall be the responsibility of Direct and
Indirect Participants.
[9. A Beneficial Owner shall give notice to elect to have its
Securities purchased or tendered, through its Participant, to
[Tender/Remarketing] Agent, and shall effect delivery of such Securities by
causing the Direct Participant to transfer the Participant's interest in the
Securities, on DTC's records, to [Tender/Remarketing] Agent. The requirement for
physical delivery of Securities in connection with an optional tender or a
mandatory purchase will be deemed satisfied when the ownership rights in the
Securities are transferred by Direct Participants on DTC's records and followed
by a book-entry credit of tendered securities to [Tender/Remarketing] Agent's
DTC account.]
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<PAGE>
10. DTC may discontinue providing its services as securities depository
with respect to the Securities at any time by giving reasonable notice to Issuer
or Agent. Under such circumstances, in the event that a successor securities
depository is not obtained, Security certificates are required to be printed and
delivered.
11. Issuer may decide to discontinue use of the system of book-entry
transfers through DTC (or a successor securities depository). In that event,
Security certificates will be printed and delivered.
12. The information in this section concerning DTC and DTC's book-entry
system has been obtained from sources that Issuer believes to be reliable, but
Issuer takes no responsibility for the accuracy thereof.
-68-
<PAGE>
EXHIBIT C
THIS CERTIFICATE IS NOT TRANSFERABLE
EXCEPT IN COMPLIANCE WITH
APPLICABLE LAW AND SECTION 510
OF THE TRUST AGREEMENT.
CERTIFICATE NUMBER NUMBER OF COMMON SECURITIES
C-__ (_______)
CERTIFICATE EVIDENCING COMMON SECURITIES
OF
AMERICAN BANCORPORATION CAPITAL TRUST I
TRUST COMMON SECURITIES
(LIQUIDATION AMOUNT $10 PER COMMON SECURITY)
American Bancorporation Capital Trust I, a statutory business trust
created under the laws of the State of Delaware (the "Trust"), hereby certifies
that American Bancorporation (the "Holder") is the registered owner of (______)
common securities of the Trust, representing beneficial interests of the Trust
and designated the Trust Common Securities (liquidation amount $10 per Common
Security) (the "Common Securities"). Except as provided in Section 510 of the
Trust Agreement (as defined below) the Common Securities are not transferable
and any attempted transfer hereof shall be void. The designations, rights,
privileges, restrictions, preferences and other terms and provisions of the
Common Securities are set forth in, and the Common Securities represented hereby
are issued and shall in all respects be subject to the terms and provisions of,
the Amended and Restated Trust Agreement of the Trust dated as of April __,
1998, as the same may be amended from time to time (the "Trust Agreement"),
including the designation of the terms of the Common Securities as set forth
therein. The Trust will furnish a copy of the Trust Agreement to the Holder
without charge upon written request to the Trust at its principal place of
business or registered office.
By receipt and acceptance of this certificate, the Holder agrees to be
bound by the Trust Agreement and is entitled to the benefits thereunder.
By acceptance, the Holder agrees to treat, for United States federal
income tax purposes, the Debentures as indebtedness and the Common Securities as
evidence of indirect beneficial ownership in the Debentures.
IN WITNESS WHEREOF, one of the Administrative Trustees of the Trust has
executed this certificate this ____ day of April, 1998.
AMERICAN BANCORPORATION CAPITAL TRUST I
By:
---------------------------------
Name: Brent E. Richmond
Title: Administrative Trustee
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<PAGE>
EXHIBIT D
AGREEMENT AS TO EXPENSES AND LIABILITIES
AGREEMENT, dated as of April __, 1998, between American Bancorporation,
an Ohio corporation (the "Corporation") having its principal office at 1025 Main
Street, Suite 800, Wheeling, WV 26003, and American Bancorporation Capital Trust
I, a Delaware business trust (the "Trust").
WHEREAS, the Trust intends to issue its Common Securities (the "Common
Securities") to and receive debentures from the Corporation and to issue and
sell ___% Trust Preferred Securities (the "Preferred Securities") with such
powers, preferences and special rights and restrictions are set forth in the
Amended and Restated Trust Agreement of the Trust, dated as of April __, 1998,
as the same may be amended from time to time (the "Trust Agreement");
WHEREAS, the Corporation will directly or indirectly own all of the
Common Securities of the Trust and will issue the debentures;
NOW, THEREFORE, in consideration of the purchase by each holder of the
Preferred Securities, which purchase the Corporation hereby agrees shall benefit
the Corporation and which purchase the Corporation acknowledges will be made in
reliance upon the execution and deliver of this Agreement, the Corporation and
Trust hereby agree as follows:
ARTICLE I
SECTION 1.1. GUARANTEE BY THE CORPORATION.
Subject to the terms and conditions hereof, the Corporation hereby
irrevocably and unconditionally guarantees to each person or entity to whom the
Trust is now or hereafter becomes indebted or liable (the "Beneficiaries") the
full payment, when and as due, of any and all Obligations (as hereinafter
defined) to such Beneficiaries. As used herein, "Obligations" means any costs,
expenses or liabilities of the Trust, other than obligations of the Trust to pay
to holders of any Preferred Securities or other similar interests in the Trust
the amounts due such holders pursuant to the terms of the Preferred Securities
or such other similar interests, as the case may be. This Agreement is intended
to be for the benefit of, and to be enforceable by, all such Beneficiaries,
whether or not such Beneficiaries have received notice hereof.
SECTION 1.2. TERM OF AGREEMENT.
This Agreement shall terminate and be of no further force and effect
upon the later of (a) the date on which full payment has been made of all
amounts payable to all holders of all the Preferred Securities (whether upon
redemption, liquidation, exchange or otherwise) and (b) the date on which there
are no Beneficiaries remaining; provided, however, that this Agreement shall
continue to be effective or shall be reinstated, as the case may be, if at any
time any holder of Preferred Securities or any Beneficiary must restore payment
of any sums paid under any Obligation, under the Guarantee Agreement dated the
date hereof by the Corporation and the Bank of New York, as guarantee trustee or
under the Agreement for any reason whatsoever. This Agreement is continuing,
irrevocable, unconditional and absolute.
SECTION 1.3. WAIVER OF NOTICE.
The Corporation hereby waives notice of acceptance of this Agreement
and of any Obligation to which it applies or may apply, and the Corporation
hereby waives presentment,
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<PAGE>
demand for payment, protest, notice of nonpayment, notice of dishonor, notice of
redemption and all other notices and demands.
SECTION 1.4. NO IMPAIRMENT.
The obligations, covenants, agreements and duties of the Corporation
under this Agreement shall in no way be affected or impaired by reason of the
happening from time to time of any of the following:
(a) the extension of time for the payment by the trust of all or any
portion of the Obligations or for the performance of any other
obligation under, arising out of, or in connection with, the
obligations;
(b) any failure, omission, delay or lack of diligence on the part of
the Beneficiaries to enforce, assert or exercise any right, privilege,
power or remedy conferred on the Beneficiaries with respect to the
Obligations or any action on the part of the Trust granting indulgence
or extension of any kind; or
(c) the voluntary or involuntary liquidation, dissolution, sale of any
collateral, receivership, insolvency, bankruptcy, assignment for the
benefit of creditors, reorganization, arrangement, composition or
readjustment of debt of, or other similar proceedings affecting, the
Trust or any of the assets of the Trust.
There shall be no obligation of the Beneficiaries to give notice to, or obtain
the consent of, the Corporation with respect to the happening of any of, the
foregoing.
SECTION 1.5. ENFORCEMENT.
A Beneficiary may enforce this Agreement directly against the
Corporation and the Corporation waives any right or remedy to require that any
action be brought against the Trust or any other person or entity before
proceeding against the Corporation.
SECTION 1.6. SUBROGATION.
The Corporation shall be subrogated to all (if any) rights of the Trust
in respect of any amounts paid to the Beneficiaries by the Corporation under
this Agreement; provided, however, that the Corporation shall not (except to the
extent required by mandatory provisions of law) be entitled to enforce or
exercise any rights which it may acquire by way of subrogation of any indemnity,
reimbursement of other agreement, in all cases as a result of payment under this
Agreement, if, at the time of any such payment, any amounts are due and unpaid
under this Agreement.
ARTICLE II
SECTION 2.1. BINDING EFFECT.
All guarantees and agreements contained in this Agreement shall bind
the successors, assigns, receivers, trustees and representatives of the
Corporation and shall inure to the benefit of the Beneficiaries.
-71-
<PAGE>
SECTION 2.2. AMENDMENT.
So long as there remains any Beneficiary or any Preferred Securities
are outstanding, this Agreement shall not be modified or amended in any manner
adverse to such Beneficiary or to the holders of the Preferred Securities.
SECTION 2.3. NOTICES.
Any notice, request or other communication required or permitted to be
given hereunder shall be given in writing by delivering the same against receipt
therefor by facsimile transmission (confirmed by mail) or by registered or
certified mail, addressed as follows (and if so given, shall be deemed given
when mailed):
American Bancorporation Capital Trust I
c/o The Bank of New York
101 Barclay Street - Floor 21-W
New York, New York 10286
Facsimile No.: (212) 815-5915
Attention: Corporate Trust Trustee Administration
American Bancorporation
1025 Main Street, Suite 800
Wheeling, WV 26003
Facsimile No.: (304) 233-2730
Attention: Jeremy C. McCamic
Chairman of the Board and Chief Executive Officer
SECTION 2.4. CHOICE OF LAW.
THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED AND INTERPRETED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICT OF
LAW PRINCIPLES THEREOF.
THE AGREEMENT is executed as of the day and year first above written.
AMERICAN BANCORPORATION
By:
-------------------------------
Name: Jeremy C. McCamic
Title: Chairman of the Board and Chief Executive Officer
AMERICAN BANCORPORATION CAPITAL TRUST I
By:
-------------------------------
Name: Brent E. Richmond
Title: Administrative Trustee
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<PAGE>
EXHIBIT E
Certificate Number Number of Preferred Securities
P-__ _________
CUSIP NO. 024075-20-2
CERTIFICATE EVIDENCING PREFERRED SECURITIES
OF
AMERICAN BANCORPORATION CAPITAL TRUST I
____% CUMULATIVE TRUST PREFERRED SECURITIES
(LIQUIDATION AMOUNT $10 PER PREFERRED SECURITY)
American Bancorporation Capital Trust I, a statutory business trust
created under the laws of the State of Delaware (the "Trust"), hereby certifies
that Cede & Co. (the "Holder") is the registered owner of
_________________________________________ preferred securities of the Trust
representing an undivided beneficial interest in the assets of the Trust and
designated the American Bancorporation Capital Trust I ____% Cumulative Trust
Preferred Securities (liquidation amount $10 per Preferred Security) (the
"Preferred Securities"). The Preferred Securities are transferable on the books
and records of the Trust, in person or by a duly authorized attorney, upon
surrender of this certificate duly endorsed and in proper form for transfer as
provided in Section 504 of the Trust Agreement (as defined below). The
designations, rights, privileges, restrictions, preferences and other terms and
provisions of the Preferred Securities are set forth in, and the Preferred
Securities represented hereby are issued and shall in all respects be subject to
the terms and provisions of, the Amended and Restated Trust Agreement of the
Trust dated as of April __, 1998, as the same may be amended from time to time
(the "Trust Agreement"), including the designation of the terms of Preferred
Securities as set forth therein. The Holder is entitled to the benefits of the
Guarantee Agreement, as amended, entered into by American Bancorporation, an
Ohio corporation, and The Bank of New York, as guarantee trustee, dated as of
April __, 1998 (the "Guarantee"), to the extent provided therein. The Trust will
furnish a copy of the Trust Agreement and the Guarantee to the Holder without
charge upon written request to the Trust at its principal place of business or
registered office.
Upon receipt of this certificate, the Holder is bound by the Trust
Agreement and is entitled to the benefits thereunder.
-73-
<PAGE>
IN WITNESS WHEREOF, one of the Administrative Trustees of the Trust has
executed this certificate this ____ day of April, 1998.
AMERICAN BANCORPORATION CAPITAL TRUST I
By:
-----------------------------------
Name: Brent E. Richmond
Title: Administrative Trustee
This is one of the Preferred Securities referred to in the Trust
Agreement.
Dated: April __, 1998 THE BANK OF NEW YORK
as Trustee
By:
-----------------------------------
Authorized Signatory
-74-
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned assigns and transfers this Security
certificate to:
(Insert assignee's social security or tax identification number)
(Insert address and zip code of assignee)
and irrevocably appoints
______________________________agent to transfer this Security certificate on the
books of the Company. The agent may substitute another to act for him or her.
Date:_____________________________________
Signature:______________________________________________________________________
(Sign exactly as your name appears on the other side of this Security)
Signature Guarantee:____________________________________________________________
- -------------------------
Signature must be guaranteed by an "eligible guarantor institution" that is a
bank, stockbroker, savings and loan association or credit union meeting the
requirements of the Registrar, which requirements include membership or
participation in the Securities Transfer Agents Medallion Program ("STAMP") or
such other "signature guarantee program" as may be determined by the Registrar
in addition to, or in substitution for, STAMP, all in accordance with the
Securities and Exchange Act of 1934, as amended.
-75-
EXHIBIT 4.6
------------
PREFERRED SECURITIES GUARANTEE AGREEMENT
BY AND BETWEEN
AMERICAN BANCORPORATION
AND
THE BANK OF NEW YORK
APRIL ___, 1998
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page No.
--------
<S> <C> <C>
ARTICLE I DEFINITIONS AND INTERPRETATION 1
Section 1.1 Definitions and Interpretation 1
ARTICLE II TRUST INDENTURE ACT 5
Section 2.1 Trust Indenture Act; Application 5
Section 2.2 Lists of Holders of Securities 5
Section 2.3 Reports by the Preferred Guarantee Trustee 6
Section 2.4 Periodic Reports to Preferred Guarantee Trustee 6
Section 2.5 Evidence of Compliance with Conditions Precedent 6
Section 2.6 Events of Default; Waiver 6
Section 2.7 Event of Default; Notice 7
Section 2.8 Conflicting Interests 7
ARTICLE III POWERS, DUTIES AND RIGHTS OF PREFERRED
GUARANTEE TRUSTEE 7
Section 3.1 Powers And Duties of The Preferred Guarantee Trustee
7
Section 3.2 Certain Rights of Preferred Guarantee Trustee 9
Section 3.3 Not Responsible For Recitals or Issuance of Guarantee
11
ARTICLE IV PREFERRED GUARANTEE TRUSTEE 11
Section 4.1 Preferred Guarantee Trustee; Eligibility 11
Section 4.2 Appointment, Removal and Resignation of Preferred
Guarantee Trustees 12
ARTICLE V GUARANTEE 13
Section 5.1 Guarantee 13
Section 5.2 Waiver of Notice and Demand 13
Section 5.3 Obligations Not Affected 13
Section 5.4 Rights of Holders 15
Section 5.5 Guarantee of Payment 15
</TABLE>
-i-
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
<S> <C> <C>
Section 5.6 Subrogation 15
Section 5.7 Independent Obligations 15
ARTICLE VI LIMITATION OF TRANSACTIONS; SUBORDINATION 16
Section 6.1 Limitation of Transactions 16
Section 6.2 Ranking 16
ARTICLE VII TERMINATION 16
Section 7.1 Termination 16
ARTICLE VIII INDEMNIFICATION 17
Section 8.1 Exculpation 17
Section 8.2 Indemnification 17
ARTICLE IX MISCELLANEOUS 18
Section 9.1 Successors and Assigns 18
Section 9.2 Amendments 18
Section 9.3 Notices 18
Section 9.4 Benefit 19
Section 9.5 Governing Law 19
</TABLE>
-ii-
<PAGE>
CROSS REFERENCE TABLE
SECTION OF TRUST INDENTURE SECTION OF GUARANTEE AGREEMENT
ACT OF 1939, AS AMENDED
310(a) 4.1(a)
310(b) 4.1(a), 2.8
310(c) Not Applicable
311(a) 2.2(b)
311(b) 2.2(b)
311(c) Not Applicable
312(a) 2.2(a)
312(b) 2.2(b)
313 2.3
314(a) 2.4
314(b) Not Applicable
314(c) 2.5
314(d) Not Applicable
314(e) 1.1, 2.5,3.2
314(f) 2.1, 3.2
315(a) 3.1(d)
315(b) 2.7
315(c) 3.1
315(d) 3.1(d)
316(a) 1.1, 2.6, 5.4
316(b) 5.3
317(a) 3.1
317(b) Not Applicable
318(a) 2.1(a)
318(b) 2.1
318(c) 2.1(b)
Note: This Cross-Reference Table does not constitute part of this Agreement and
shall not affect the interpretation of any of its terms or provisions
<PAGE>
PREFERRED SECURITIES GUARANTEE AGREEMENT
THIS PREFERRED SECURITIES GUARANTEE AGREEMENT (this "Preferred
Securities Guarantee"), dated as of April ___, 1998, is executed and delivered
by AMERICAN BANCORPORATION, an Ohio corporation (the "Guarantor"), and THE BANK
OF NEW YORK, a New York banking corporation, as trustee (the "Preferred
Guarantee Trustee"), for the benefit of the Holders (as defined herein) from
time to time of the Preferred Securities (as defined herein) of American
Bancorporation Capital Trust I, a Delaware statutory business trust (the
"Trust").
RECITALS
WHEREAS, pursuant to an Amended and Restated Trust Agreement (the
"Trust Agreement"), dated as of April ___, 1998, among the trustees of the Trust
named herein, the Guarantor, as depositor, and the holders from time to time of
undivided beneficial interests in the assets of the Trust, the Trust is issuing
on the date hereof preferred securities, having an aggregate liquidation amount
of $10, designated the _____% Cumulative Trust Preferred Securities (the
"Preferred Securities") representing undivided beneficial ownership interests in
the assets of the Trust and having the terms set forth in the Trust Agreement;
WHEREAS, the Preferred Securities will be issued by the Trust and the
proceeds thereof, will be used to purchase the _____% Junior Subordinated
Deferrable Interest Debentures due 2028 (the "Junior Subordinated Debentures")
of the Guarantor which will be deposited with The Bank of New York, as Property
Trustee under the Trust Agreement, as trust assets; and
WHEREAS, as an incentive for the Holders to purchase the Preferred
Securities, the Guarantor desires irrevocably and unconditionally to agree, to
the extent set forth in this Preferred Securities Guarantee, to pay to the
Holders of the Preferred Securities the Guarantee Payments (as defined herein)
and to make certain other payments on the terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the purchase by each Holder of
Preferred Securities, which purchase the Guarantor hereby agrees shall benefit
the Guarantor, the Guarantor executes and delivers this Preferred Securities
Guarantee for the benefit of the Holders.
ARTICLE I
DEFINITIONS AND INTERPRETATION
SECTION 1.1 DEFINITIONS AND INTERPRETATION.
In this Preferred Securities Guarantee, unless the context otherwise
requires:
(a) capitalized terms used in this Preferred Securities Guarantee but
not defined in the preamble above have the respective meanings assigned to them
in this Section 1.1;
<PAGE>
(b) terms defined in the Trust Agreement in effect on the date of
execution of this Preferred Securities Guarantee have the same meaning when used
in this Preferred Securities Guarantee unless otherwise defined herein;
(c) a term defined anywhere in this Preferred Securities Guarantee has
the same meaning throughout;
(d) all references to "the Preferred Securities Guarantee" or "this
Preferred Securities Guarantee" are to this Preferred Securities Guarantee as
modified, supplemented or amended from time to time;
(e) all references in this Preferred Securities Guarantee to Articles
and Sections are to Articles and Sections of this Preferred Securities
Guarantee, unless otherwise specified;
(f) a term defined in the Trust Indenture Act has the same meaning when
used in this Preferred Securities Guarantee, unless otherwise defined in this
Preferred Securities Guarantee or unless the context otherwise requires; and
(g) a reference to the singular includes the plural and vice versa.
"Affiliate" has the same meaning as given to that term in Rule 405 of
the Securities Act of 1933, as amended, or any successor rule thereunder.
"Business Day" means any day other than a day on which federal or state
banking institutions in the Borough of Manhattan, The City of New York, or the
State of Delaware are authorized or required by law, executive order or
regulation to close or a day on which the Corporate Trust Office of the
Preferred Guarantee Trustee is closed for business.
"Corporate Trust Office" means the office of the Preferred Guarantee
Trustee at which the corporate trust business of the Preferred Guarantee Trustee
shall, at any particular time, be principally administered, which office at the
date of execution of this Agreement is located at The Bank of New York, 101
Barclay Street, Floor 21 West, New York, New York 10286, Attention: Corporate
Trust Trustee Administration.
"Covered Person" means any Holder or beneficial owner of Preferred
Securities.
"Debentures" means the ______% Junior Subordinated Debentures due 2028,
of the Debenture Issuer held by the Property Trustee of the Trust.
"Debenture Issuer" means the Guarantor.
"Debt" means with respect to any person, whether recourse is to all or
a portion of the assets of such Person and whether or not contingent: (i) every
obligation of such Person for money borrowed; (ii) every obligation of such
Persons evidenced by bonds, debentures, notes or
-2-
<PAGE>
other similar instruments, including obligations incurred in connection with the
acquisition of property, assets or businesses; (iii) every reimbursement
obligation of such Person with respect to letters of credit, bankers'
acceptances or similar facilities issued for the account of such Person; (iv)
every obligation of such Person issued or assumed as the deferred purchase price
of property or services (but excluding trade accounts payable or accrued
liabilities arising in the ordinary course of business); (v) every capital lease
obligation of such Person; (vi) all indebtedness of such person whether incurred
on or prior to the date of the Indenture or thereafter incurred, for claims in
respect of derivative products, including interest rate, foreign exchange rate
and commodity forward contracts, options and swaps and similar arrangements; and
(vii) every obligation of the type referred to in clauses (i) through (vi) of
another Person and all dividends of another Person the payments of which, in
either case, such Person has guaranteed or is responsible or liable, directly or
indirectly, as obligor or otherwise.
"Event of Default" means a default by the Guarantor on any of its
payment or other obligations under this Preferred Securities Guarantee.
"Guarantor" means American Bancorporation., an Ohio corporation.
"Guarantee Payments" means the following payments or distributions,
without duplication, with respect to the Preferred Securities, to the extent not
paid or made by the Trust: (i) any accrued and unpaid Distributions (as defined
in the Trust Agreement) that are required to be paid on such Preferred
Securities, to the extent the Trust shall have funds available therefor, (ii)
the redemption price, including all accrued and unpaid Distributions to the date
of redemption (the "Redemption Price"), to the extent the Trust has funds
available therefor, with respect to any Preferred Securities called for
redemption by the Trust, and (iii) upon a voluntary or involuntary dissolution,
winding-up or termination of the Trust (other than in connection with the
distribution of Junior Subordinated Debentures to the Holders in exchange for
Preferred Securities as provided in the Trust Agreement or a redemption of all
of the Preferred Securities), the lesser of (a) the aggregate of the liquidation
amount and all accrued and unpaid Distributions on the Preferred Securities to
the date of payment, to the extent the Trust shall have funds available therefor
(the "Liquidation Distribution"), and (b) the amount of assets of the Trust
remaining available for distribution to Holders in liquidation of the Trust.
"Holder" shall mean any holder, as registered on the books and records
of the Trust, of any Preferred Securities; provided, however, that, in
determining whether the holders of the requisite percentage of Preferred
Securities have given any request, notice, consent or waiver hereunder, "Holder"
shall not include the Guarantor or any Affiliate of the Guarantor.
"Indemnified Person" means the Preferred Guarantee Trustee, any
Affiliate of the Preferred Guarantee Trustee, or any officers, directors,
shareholders, members, partners, employees, representatives, nominees,
custodians or agents of the Preferred Guarantee Trustee.
"Indenture" means the Indenture dated as of _______ __, 1998, among the
Debenture Issuer and The Bank of New York, as trustee, and any supplemental
indenture thereto pursuant
-3-
<PAGE>
to which certain subordinated debt securities of the Debenture Issuer are to be
issued to the Property Trustee of the Trust.
"Junior Subordinated Debentures" shall have the meaning set forth in
the Recitals hereto.
"Liquidation Distribution" has the meaning provided therefor in the
definition of Guarantee Payments. "Majority in liquidation amount of the
Preferred Securities" means the holders of more than 50% of the liquidation
amount (including the stated amount that would be paid on redemption,
liquidation or otherwise, plus accrued and unpaid Distributions to the date upon
which the voting percentages are determined) of all of the Preferred Securities.
"Officers' Certificate" means, with respect to any Person, a
certificate signed by two authorized officers of such Person. Any Officers'
Certificate delivered with respect to compliance with a condition or covenant
provided for in this Preferred Securities Guarantee shall include:
(a) a statement that each officer signing the Officers' Certificate has
read the covenant or condition and the definitions relating thereto;
(b) a brief statement of the nature and scope of the examination or
investigation undertaken by each officer in rendering the Officers' Certificate;
(c) a statement that each such officer has made such examination or
investigation as, in such officer's opinion, is necessary to enable such officer
to express an informed opinion as to whether or not such covenant or condition
has been complied with; and
(d) a statement as to whether, in the opinion of each such officer,
such condition or covenant has been complied with.
"Person" means a legal person, including any individual, corporation,
estate, partnership, joint venture, association, joint stock company, limited
liability company, trust, unincorporated association, or government or any
agency or political subdivision thereof, or any other entity of whatever nature.
"Preferred Guarantee Trustee" means The Bank of New York, until a
Successor Preferred Guarantee Trustee has been appointed and has accepted such
appointment pursuant to the terms of this Preferred Securities Guarantee and
thereafter means each such Successor Preferred Guarantee Trustee.
"Redemption Price" has the meaning provided therefor in the definition
of Guarantee Payments.
"Responsible Officer" means, with respect to the Preferred Guarantee
Trustee, any officer of the Preferred Guarantee Trustee, including any
vice-president, any assistant vice-president, any assistant secretary, any
assistant treasurer or other officer customarily performing functions
-4-
<PAGE>
similar to those performed by any of the above designated officers and also
means, with respect to a particular corporate trust matter, any other officer to
whom such matter is referred because of that officers knowledge of and
familiarity with the particular subject.
"Senior Indebtedness" shall have the meaning set forth in Section 16.1
of the Indenture.
"Successor Preferred Guarantee Trustee" means a successor Preferred
Guarantee Trustee possessing the qualifications to act as Preferred Guarantee
Trustee under Section 4.1.
"Trust Indenture Act" means the Trust Indenture Act of 1939, as
amended.
ARTICLE II
TRUST INDENTURE ACT
SECTION 2.1 TRUST INDENTURE ACT; APPLICATION.
(a) This Preferred Securities Guarantee is subject to the provisions of
the Trust Indenture Act that are required to be part of this Preferred
Securities Guarantee and shall, to the extent applicable, be governed by such
provisions.
(b) If and to the extent that any provision of this Preferred
Securities Guarantee limits, qualifies or conflicts with the duties imposed by
Section 310 to 317, inclusive, of the Trust Indenture Act, such imposed duties
shall control.
SECTION 2.2 LISTS OF HOLDERS OF SECURITIES.
(a) The Guarantor shall provide the Preferred Guarantee Trustee with a
list, in such form as the Preferred Guarantee Trustee may reasonably require, of
the names and addresses of the Holders of the Preferred Securities ("List of
Holders") as of such date, (i) within one Business Day after January 30 and June
30 of each year, and (ii) at any other time within 30 days of receipt by the
Guarantor of a written request for a List of Holders as of a date no more than
15 days before such List of Holders is given to the Preferred Guarantee Trustee;
provided, that the Guarantor shall not be obligated to provide such List of
Holders at any time the List of Holders does not differ from the most recent
List of Holders given to the Preferred Guarantee Trustee by the Guarantor or so
long as the Preferred Guaranty Trust shall be the Securities Registrar under the
Trust Agreement. The Preferred Guarantee Trustee may destroy any List of Holders
previously given to it on receipt of a new List of Holders.
(b) The Preferred Guarantee Trustee shall comply with its obligations
under Sections 311(a), 311(b) and Section 312(b) of the Trust Indenture Act.
-5-
<PAGE>
SECTION 2.3 REPORTS BY THE PREFERRED GUARANTEE TRUSTEE.
The Preferred Guarantee Trustee shall provide to the Holders of the
Preferred Securities such reports as are required by Section 313 of the Trust
Indenture Act, if any, in the form and in the manner provided by Section 313 of
the Trust Indenture Act. The Preferred Guarantee Trustee shall also comply with
the requirements of Section 313(d) of the Trust Indenture Act.
SECTION 2.4 PERIODIC REPORTS TO PREFERRED GUARANTEE TRUSTEE.
The Guarantor shall provide to the Preferred Guarantee Trustee such
documents, reports and information as required by Section 314 (if any) and the
compliance certificate required by Section 314 of the Trust Indenture Act in the
form, in the manner and at the times required by Section 314 of the Trust
Indenture Act. Delivery of such reports, information and documents to the
Preferred Guarantee Trustee is for informational purposes only and the Preferred
Guarantee Trustee's receipt of such shall not constitute constructive notice of
any information contained therein or determinable from information contained
herein, including the Guarantor's compliance with any of its covenants hereunder
(as to which the Preferred Guarantee Trustee is entitled to rely exclusively on
Officer's Certificates).
SECTION 2.5 EVIDENCE OF COMPLIANCE WITH CONDITIONS PRECEDENT.
The Guarantor shall provide to the Preferred Guarantee Trustee such
evidence of compliance with any conditions precedent, if any, provided for in
this Preferred Securities Guarantee that relate to any of the matters set forth
in Section 314(c) of the Trust Indenture Act. Any certificate or opinion
required to be given by an officer pursuant to Section 314(c) may be given in
the form of an Officers' Certificate.
SECTION 2.6 EVENTS OF DEFAULT; WAIVER.
The Holders of a Majority in liquidation amount of Preferred Securities
may, by vote, on behalf of the Holders of all of the Preferred Securities, waive
any past Event of Default and its consequences. Upon such waiver, any such Event
of Default shall cease to exist, and any Event of Default arising therefrom
shall be deemed to have been cured, for every purpose of this Preferred
Securities Guarantee, but no such waiver shall extend to any subsequent or other
default or Event of Default or impair any right consequent thereon.
SECTION 2.7 EVENT OF DEFAULT; NOTICE.
(a) The Preferred Guarantee Trustee shall, within 90 days after the
occurrence of an Event of Default, transmit by mail, first class postage
prepaid, to the Holders of the Preferred Securities, notices of all Events of
Default actually known to a Responsible Officer of the Preferred Guarantee
Trustee, unless such defaults have been cured before the giving of such notice;
provided, that the Preferred Guarantee Trustee shall be protected in withholding
such notice if and so long as a Responsible Officer of the Preferred Guarantee
Trustee in good faith
-6-
<PAGE>
determines that the withholding of such notice is in the interest of the Holders
of the Preferred Securities.
(b) The Preferred Guarantee Trustee shall not be deemed to have
knowledge of any Event of Default unless the Preferred Guarantee Trustee shall
have received written notice, or of which a Responsible Officer of the Preferred
Guarantee Trustee charged with the administration of the Trust Agreement shall
have obtained actual knowledge.
SECTION 2.8 CONFLICTING INTERESTS.
The Trust Agreement shall be deemed to be specifically described in
this Preferred Securities Guarantee for the purposes of clause (i) of the first
proviso contained in Section 310(b) of the Trust Indenture Act.
ARTICLE III
POWERS, DUTIES AND RIGHTS OF PREFERRED GUARANTEE TRUSTEE
SECTION 3.1 POWERS AND DUTIES OF THE PREFERRED GUARANTEE TRUSTEE.
(a) This Preferred Securities Guarantee shall be held by the Preferred
Guarantee Trustee for the benefit of the Holders of the Preferred Securities,
and the Preferred Guarantee Trustee shall not transfer this Preferred Securities
Guarantee to any Person except a Holder of Preferred Securities exercising his
or her rights pursuant to Section 5.4(b) or to a Successor Preferred Guarantee
Trustee on acceptance by such Successor Preferred Guarantee Trustee of its
appointment to act as Successor Preferred Guarantee Trustee. The right, title
and interest of the Preferred Guarantee Trustee shall automatically vest in any
Successor Preferred Guarantee Trustee, and such vesting and cessation of title
shall be effective whether or not conveyancing documents have been executed and
delivered pursuant to the appointment of such Successor Preferred Guarantee
Trustee.
(b) If an Event of Default actually known to a Responsible Officer of
the Preferred Guarantee Trustee has occurred and is continuing, the Preferred
Guarantee Trustee shall enforce this Preferred Securities Guarantee for the
benefit of the Holders of the Preferred Securities.
(c) The Preferred Guarantee Trustee, before the occurrence of any Event
of Default and after the curing of all Events of Default that may have occurred,
shall undertake to perform only such duties as are specifically set forth in
this Preferred Securities Guarantee, and no implied covenants shall be read into
this Preferred Securities Guarantee against the Preferred Guarantee Trustee. In
case an Event of Default has occurred (that has not been cured or waived
pursuant to Section 2.6) and is actually known to a Responsible Officer of the
Preferred Guarantee Trustee, the Preferred Guarantee Trustee shall exercise such
of the rights and powers vested in it by this Preferred Securities Guarantee,
and use the same degree of care and skill in its exercise
-7-
<PAGE>
thereof, as a prudent person would exercise or use under the circumstances in
the conduct of his or her own affairs.
(d) No provision of this Preferred Securities Guarantee shall be
construed to relieve the Preferred Guarantee Trustee from liability for its own
negligent action, its own negligent failure to act, or its own willful
misconduct, except that:
(i) prior to the occurrence of any Event of Default and after
the curing or waiving of all such Events of Default that may
have occurred:
(A) the duties and obligations of the Preferred
Guarantee Trustee shall be determined solely by the
express provisions of this Preferred Securities
Guarantee, and the Preferred Guarantee Trustee shall
not be liable except for the performance of such
duties and obligations as are specifically set forth
in this Preferred Securities Guarantee, and no
implied covenants or obligations shall be read into
this Preferred Securities Guarantee against the
Preferred Guarantee Trustee; and
(B) in the absence of bad faith on the part of the
Preferred Guarantee Trustee, the Preferred Guarantee
Trustee may conclusively rely, as to the truth of the
statements and the correctness of the opinions
expressed herein, upon any certificates or opinions
furnished to the Preferred Guarantee Trustee and
conforming to the requirements of this Preferred
Securities Guarantee; but in the case of any such
certificates or opinions that by any provision hereof
are specifically required to be furnished to the
Preferred Guarantee Trustee, the Preferred Guarantee
Trustee shall be under a duty to examine the same to
determine whether or not they conform to the
requirements of this Preferred Securities Guarantee;
(ii) the Preferred Guarantee Trustee shall not be liable for
any error of judgment made in good faith by a Responsible
Officer of the Preferred Guarantee Trustee, unless it shall be
proved that the Preferred Guarantee Trustee was negligent in
ascertaining the pertinent facts upon which such judgment was
made;
(iii) the Preferred Guarantee Trustee shall not be liable with
respect to any action taken or omitted to be taken by it in
good faith in accordance with the written direction of the
Holders of not less than a Majority in liquidation amount of
the Preferred Securities relating to the time, method and
place of conducting any proceeding for any remedy available to
the Preferred Guarantee Trustee, or exercising any trust or
power conferred upon the Preferred Guarantee Trustee under
this Preferred Securities Guarantee; and
(iv) no provision of this Preferred Securities Guarantee shall
require the Preferred Guarantee Trustee to expend or risk its
own funds or otherwise incur
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<PAGE>
personal financial liability in the performance of any of its
duties or in the exercise of any of its rights or powers, if
the Preferred Guarantee Trustee shall have reasonable grounds
for believing that the repayment of such funds or liability is
not reasonably assured to it under the terms of this Preferred
Securities Guarantee or indemnity, reasonably satisfactory to
the Preferred Guarantee Trustee, against such risk or
liability is not reasonably assured to it.
SECTION 3.2 CERTAIN RIGHTS OF PREFERRED GUARANTEE TRUSTEE.
(a) Subject to the provisions of Section 3.1:
(i) the Preferred Guarantee Trustee may conclusively rely, and
shall be fully protected in acting or refraining from acting
upon, any resolution, certificate, statement, instrument,
opinion, report notice, request, direction, consent, order,
bond, debenture, note, other evidence of indebtedness or other
paper or document believed by it to be genuine and to have
been signed, sent or presented by the proper party or parties;
(ii) any direction or act of the Guarantor contemplated by
this Preferred Securities Guarantee shall be sufficiently
evidenced by an Officers' Certificate;
(iii) whenever, in the administration of this Preferred
Securities Guarantee, the Preferred Guarantee Trustee shall
deem it desirable that a matter be proved or established
before taking, suffering or omitting any action hereunder, the
Preferred Guarantee Trustee (unless other evidence is herein
specifically prescribed) may, in the absence of bad faith on
its part, request and conclusively rely upon an Officers'
Certificate which, upon receipt of such request, shall be
promptly delivered by the Guarantor;
(iv) the Preferred Guarantee Trustee shall have no duty to see
to any recording, filing or registration of any instrument (or
any rerecording, refiring or reregistration thereof);
(v) the Preferred Guarantee Trustee may consult with counsel
of its selection, and the advice or opinion of such counsel
with respect to legal matters shall be full and complete
authorization and protection in respect of any action taken,
suffered or omitted by it hereunder in good faith and in
accordance with such advice or opinion. Such counsel may be
counsel to the Guarantor or any of its Affiliates and may
include any of its employees. The Preferred Guarantee Trustee
shall have the right at any time to seek instructions
concerning the administration of this Preferred Securities
Guarantee from any court of competent jurisdiction;
(vi) the Preferred Guarantee Trustee shall be under no
obligation to exercise any of the rights or powers vested in
it by this Preferred Securities Guarantee at
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the request or direction of any Holder, unless such Holder
shall have provided to the Preferred Guarantee Trustee such
security and indemnity, reasonably satisfactory to the
Preferred Guarantee Trustee, against the costs, expenses
(including attorneys' fees and expenses and the expenses of
the Preferred Guarantee Trustee's agents, nominees or
custodians) and liabilities that might be incurred by it in
complying with such request or direction, including such
reasonable advances as may be requested by the Preferred
Guarantee Trustee; provided that, nothing contained in this
Section 3.2(a)(vi) shall be taken to relieve the Preferred
Guarantee Trustee, upon the occurrence of an Event of Default,
of its obligation to exercise the rights and powers vested in
it by this Preferred Securities Guarantee;
(vii) the Preferred Guarantee Trustee shall not be bound to
make any investigation into the facts or matters stated in any
resolution, certificate, statement, instrument, opinion,
report, notice, request, direction, consent, order, bond,
debenture, note, other evidence of indebtedness or other paper
or document, but the Preferred Guarantee Trustee, in its
discretion, may make such further inquiry or investigation
into such facts or matters as it may see fit;
(viii) the Preferred Guarantee Trustee may execute any of the
trusts or powers hereunder or perform any duties hereunder
either directly or by or through agents, nominees, custodians
or attorneys, and the Preferred Guarantee Trustee shall not be
responsible for any misconduct or negligence on the part of
any agent or attorney appointed with due care by it hereunder;
(ix) any action taken by the Preferred Guarantee Trustee or
its agents hereunder shall bind the Holders of the Preferred
Securities, and the signature of the Preferred Guarantee
Trustee or its agents alone shall be sufficient and effective
to perform any such action. No third party shall be required
to inquire as to the authority of the Preferred Guarantee
Trustee to so act or as to its compliance with any of the
terms and provisions of this Preferred Securities Guarantee,
both of which shall be conclusively evidenced by the Preferred
Guarantee Trustee's or its agent's taking such action;
(x) whenever in the administration of this Preferred
Securities Guarantee the Preferred Guarantee Trustee shall
deem it desirable to receive instructions with respect to
enforcing any remedy or right or taking any other action
hereunder, the Preferred Guarantee Trustee (i) may request
written instructions from the Holders of a Majority in
liquidation amount of the Preferred Securities, (ii) may
refrain from enforcing such remedy or right or taking such
other action until such written instructions are received, and
(iii) shall be protected in conclusively relying on or acting
in accordance with such instructions.
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(b) No provision of this Preferred Securities Guarantee shall be deemed
to impose any duty or obligation on the Preferred Guarantee Trustee to perform
any act or acts or exercise any right, power, duty or obligation conferred or
imposed on it in any jurisdiction in which it shall be illegal, or in which the
Preferred Guarantee Trustee shall be unqualified or incompetent in accordance
with applicable law, to perform any such act or acts or to exercise any such
right, power, duty or obligation. No permissive power or authority available to
the Preferred Guarantee Trustee shall be construed to be a duty.
SECTION 3.3 NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF GUARANTEE.
The Recitals contained in this Guarantee shall be taken as the
statements of the Guarantor, and the Preferred Guarantee Trustee does not assume
any responsibility for their correctness. The Preferred Guarantee Trustee makes
no representation as to the validity or sufficiency of this Preferred Securities
Guarantee.
ARTICLE IV
PREFERRED GUARANTEE TRUSTEE
SECTION 4.1 PREFERRED GUARANTEE TRUSTEE; ELIGIBILITY.
(a) There shall at all times be a Preferred Guarantee Trustee which
shall:
(i) not be an Affiliate of the Guarantor; and
(ii) be a corporation organized and doing business under
the laws of the United States of America or any State
or Territory thereof or of the District of Columbia,
or a corporation or Person permitted by the
Securities and Exchange Commission to act as an
institutional trustee under the Trust Indenture Act,
authorized under such laws to exercise corporate
trust powers, having a combined capital and surplus
of at least $50,000,000, and subject to supervision
or examination by Federal, State, Territorial or
District of Columbia authority. If such corporation
publishes reports of condition at least annually,
pursuant to law or to the requirements of the
supervising or examining authority referred to above,
then, for the purposes of this Section 4.1 (a)(ii),
the combined capital and surplus of such corporation
shall be deemed to be its combined capital and
surplus as set forth in its most recent report of
condition as published.
(b) If at any time the Preferred Guarantee Trustee shall cease to be
eligible to so act under Section 4.1 (a), the Preferred Guarantee Trustee shall
immediately resign in the manner and with the effect set out in Section 4.2(c).
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(c) If the Preferred Guarantee Trustee has or shall acquire any
"conflicting interest" within the meaning of Section 310(b) of the Trust
Indenture Act, the Preferred Guarantee Trustee and Guarantor shall in all
respects comply with the provisions of Section 310(b) of the Trust Indenture
Act.
SECTION 4.2 APPOINTMENT, REMOVAL AND RESIGNATION OF PREFERRED GUARANTEE
TRUSTEES.
(a) Subject to Section 4.2(c), the Preferred Guarantee Trustee may be
appointed or removed without cause at any time by the Guarantor except during an
Event of Default.
(b) The Preferred Guarantee Trustee may be removed for cause at any
time by Act (within the meaning of Section 608 of the Trust Agreement) of the
Holders of at least a Majority in liquidation amount of the Preferred
Securities, delivered to the Preferred Guarantee Trustee.
(c) The Preferred Guarantee Trustee shall not be removed in accordance
with Sections 4.2(a) and 4.2(b) until a Successor Preferred Guarantee Trustee
has been appointed and has accepted such appointment by written instrument
executed by such Successor Preferred Guarantee Trustee and delivered to the
Guarantor.
(d) The Preferred Guarantee Trustee appointed to office shall hold
office until a Successor Preferred Guarantee Trustee shall have been appointed
or until its removal or resignation. The Preferred Guarantee Trustee may resign
from office (without need for prior or subsequent accounting) by an instrument
in writing executed by the Preferred Guarantee Trustee and delivered to the
Guarantor, which resignation shall not take effect until a Successor Preferred
Guarantee Trustee has been appointed and has accepted such appointment by
instrument in writing executed by such Successor Preferred Guarantee Trustee and
delivered to the Guarantor and the resigning Preferred Guarantee Trustee.
(e) If no Successor Preferred Guarantee Trustee shall have been
appointed and accepted appointment as provided in this Section 4.2 within 60
days after delivery of an instrument of resignation, the resigning Preferred
Guarantee Trustee may petition any court of competent jurisdiction for
appointment of a Successor Preferred Guarantee Trustee. Such court may
thereupon, after prescribing such notice, if any, as it may deem proper, appoint
a Successor Preferred Guarantee Trustee.
(f) No Preferred Guarantee Trustee shall be liable for the acts or
omissions to act of any Successor Preferred Guarantee Trustee.
(g) Upon termination of this Preferred Securities Guarantee or removal
or resignation of the Preferred Guarantee Trustee pursuant to this Section 4.2,
the Guarantor shall pay to the Preferred Guarantee Trustee all amounts accrued
to the date of such termination, removal or resignation.
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ARTICLE V
GUARANTEE
SECTION 5.1 GUARANTEE.
The Guarantor irrevocably and unconditionally agrees to pay in full to
the Holders the Guarantee Payments (without duplication of amounts theretofore
paid by the Trust), as and when due, regardless of any defense, right of set-off
or counterclaim that the Trust may have or assert. The Guarantor's obligation to
make a Guarantee Payment may be satisfied by direct payment of the required
amounts by the Guarantor to the Holders or by causing the Trust to pay such
amounts to the Holders.
SECTION 5.2 WAIVER OF NOTICE AND DEMAND.
The Guarantor hereby waives notice of acceptance of this Preferred
Securities Guarantee and of any liability to which it applies or may apply,
presentment, demand for payment, any right to require a proceeding first against
the Trust or any other Person before proceeding against the Guarantor, protest,
notice of nonpayment, notice of dishonor, notice of redemption and all other
notices and demands.
SECTION 5.3 OBLIGATIONS NOT AFFECTED.
The obligations, covenants, agreements and duties of the Guarantor
under this Preferred Securities Guarantee shall in no way be affected or
impaired by reason of the happening from time to time of any of the following:
(a) the release or waiver, by operation of law or otherwise, of the
performance or observance by the Trust of any express or implied agreement,
covenant, term or condition relating to the Preferred Securities to be performed
or observed by the Trust;
(b) the extension of time for the payment by the Trust of all or any
portion of the Distributions, Redemption Price, Liquidation Distribution or any
other sums payable under the terms of the Preferred Securities or the extension
of time for the performance of any other obligation under, arising out of, or in
connection with, the Preferred Securities (other than an extension of time for
payment of Distributions, Redemption Price, Liquidation Distribution or other
sum payable that results from the extension of any interest payment period on
the Junior Subordinated Debentures);
(c) any failure, omission, delay or lack of diligence on the part of
the Holders to enforce, assert or exercise any right, privilege, power or remedy
conferred on the Holders pursuant to the terms of the Preferred Securities, or
any action on the part of the Trust granting indulgence or extension of any
kind;
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<PAGE>
(d) the voluntary or involuntary liquidation, dissolution, sale of any
collateral, receivership, insolvency, bankruptcy, assignment for the benefit of
creditors, reorganization, arrangement, composition or readjustment of debt of,
or other similar proceedings affecting, the Trust or any of the assets of the
Trust;
(e) any invalidity of, or defect or deficiency in, the Preferred
Securities;
(f) any failure or omission to receive any regulatory approval or
consent required in connection with the Preferred Securities (or the common
equity securities issued by the Trust), including the failure to receive any
regulatory approval required in connection with the redemption of the Preferred
Securities;
(g) the settlement or compromise of any obligation guaranteed hereby or
hereby incurred; or
(h) any other circumstance whatsoever that might otherwise constitute a
legal or equitable discharge or defense of a guarantor, it being the intent of
this Section 5.3 that the obligations of the Guarantor hereunder shall be
absolute and unconditional under any and all circumstances.
There shall be no obligation of the Holders to give notice to, or
obtain consent of, the Guarantor with respect to the happening of any of the
foregoing.
SECTION 5.4 RIGHTS OF HOLDERS.
(a) The Guarantor expressly acknowledges that: (i) this Guarantee will
be deposited with the Preferred Guarantee Trustee to be held for the benefit of
the Holder; (ii) the Preferred Guarantee Trustee has the right to enforce this
Preferred Securities Guarantee; and (iii) Holders of a Majority in liquidation
amount of the Preferred Securities have the right to direct the time, method and
place of conducting any proceeding for any remedy available to the Preferred
Guarantee Trustee in respect of this Preferred Securities Guarantee or
exercising any trust or power conferred upon the Preferred Guarantee Trustee
under this Preferred Securities Guarantee.
(b) Any Holder of Preferred Securities may institute a legal proceeding
directly against the Guarantor to enforce its rights under this Preferred
Securities Guarantee, without first instituting a legal proceeding against the
Trust, the Preferred Guarantee Trustee or any other Person.
SECTION 5.5 GUARANTEE OF PAYMENT.
This Preferred Securities Guarantee creates a guarantee of payment and
not of collection. This Preferred Securities Guarantee will not be discharged
except by payment of the Guarantee Payments in full (without duplication of
amounts theretofore paid by the Trust).
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<PAGE>
SECTION 5.6 SUBROGATION.
The Guarantor shall be subrogated to all (if any) rights of the Holders
of Preferred Securities against the Trust in respect of any amounts paid to such
Holders by the Guarantor under this Preferred Securities Guarantee; provided,
however, that the Guarantor shall not (except to the extent required by
mandatory provisions of law) be entitled to enforce or exercise any right that
it may acquire by way of subrogation or any indemnity, reimbursement or other
agreement, in all cases as a result of payment under this Preferred Securities
Guarantee, if, at the time of any such payment, any amounts are due and unpaid
under this Preferred Securities Guarantee. If any amount shall be paid to the
Guarantor in violation of the preceding sentence, the Guarantor agrees to hold
such amount in trust for the Holders and to pay over such amount to the Holders.
SECTION 5.7 INDEPENDENT OBLIGATIONS.
The Guarantor acknowledges that its obligations hereunder are
independent of the obligations of the Trust with respect to the Preferred
Securities, and that the Guarantor shall be liable as principal and as debtor
hereunder to make Guarantee Payments pursuant to the terms of this Preferred
Securities Guarantee notwithstanding the occurrence of any event referred to in
subsections (a) through (h), inclusive, of Section 5.3 hereof.
ARTICLE VI
LIMITATION OF TRANSACTIONS; SUBORDINATION
SECTION 6.1 LIMITATION OF TRANSACTIONS.
So long as any Preferred Securities remain outstanding, if there shall
have occurred an Event of Default under this Preferred Securities Guarantee, an
Event of Default under the Trust Agreement or during an Extended Interest
Payment Period (as defined in the Indenture), then (a) the Guarantor shall not,
and shall not permit any Subsidiary to, declare or pay any dividend on, make any
distributions with respect to, or redeem, purchase, acquire or make a
liquidation payment with respect to, any of its capital stock (other than (i)
the reclassification of any class of the Company's capital stock into another
class of capital stock, (ii) dividends or distributions payable in any class of
the Company's common stock, (iii) any declaration of a dividend in connection
with the implementation of a shareholder rights plan, or the issuance of stock
under any such plan in the future, or the redemption or repurchase of any such
rights pursuant thereto and (iv) purchases of the Company's common stock related
to the rights under any of the Company's benefit plans for its or its
subsidiaries' directors, officers or employees), and (b) the Guarantor shall
not, and shall not permit any Subsidiary to, make any payment of interest or
principal on or repay, repurchase or redeem any debt securities issued by the
Guarantor which rank pari passu with or junior to the Junior Subordinated
Debentures; and (c) the Guarantor shall not redeem, purchase or acquire less
than all of the outstanding Debentures or any of the Preferred Securities.
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<PAGE>
SECTION 6.2 RANKING.
This Preferred Securities Guarantee will constitute an unsecured
obligation of the Guarantor and will rank (i) subordinate and junior in right of
payment to all other Senior Indebtedness of the Guarantor, (ii) pari passu with
the most senior preferred securities or preference stock now or hereafter issued
by the Guarantor and with any guarantee now or hereafter entered into by the
Guarantor in respect to any preferred securities or preference stock of any
Affiliate of the Guarantor, and (iii) senior to the Guarantor's common stock.
ARTICLE VII
TERMINATION
SECTION 7.1 TERMINATION.
This Preferred Securities Guarantee shall terminate upon (i) full
payment of the Redemption Price of all Preferred Securities, (ii) upon full
payment of the amounts payable in accordance with the Trust Agreement upon
liquidation of the Trust, or (iii) upon distribution of the Junior Subordinated
Debentures to the Holders of the Preferred Securities. Notwithstanding the
foregoing, this Preferred Securities Guarantee shall continue to be effective or
shall be reinstated, as the case may be, if at any time any Holder of Preferred
Securities must restore payment of any sums paid under the Preferred Securities
or under this Preferred Securities Guarantee.
ARTICLE VIII
INDEMNIFICATION
SECTION 8.1 EXCULPATION.
(a) No Indemnified Person shall be liable, reasonable or accountable in
damages or otherwise to the Guarantor or any Covered Person for any loss, damage
or claim incurred by reason of any act or omission performed or omitted by such
Indemnified Person in good faith in accordance with this Preferred Securities
Guarantee and in a manner that such Indemnified Person reasonably believed to be
within the scope of the authority conferred on such Indemnified Person by this
Preferred Securities Guarantee or by law, except that an Indemnified Person
shall be liable for any such loss, damage or claim incurred by reason of such
Indemnified Person's negligence or willful misconduct with respect to such acts
or omissions.
(b) An Indemnified Person shall be fully protected in relying in good
faith upon the records of the Guarantor and upon such information, opinions,
reports or statements presented to the Guarantor by any Person as to matters the
Indemnified Person reasonably believes are within such other Person's
professional or expert competence and who has been selected with reasonable care
by or on behalf of the Guarantor, including information, opinions, reports or
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<PAGE>
statements as to the value and amount of the assets, liabilities, profits,
losses, or any other facts pertinent to the existence and amount of assets from
which Distributions to Holders of Preferred Securities might properly be paid.
SECTION 8.2 INDEMNIFICATION.
The Guarantor agrees to indemnify each Indemnified Person for, and to
hold each Indemnified Person harmless against, any and all loss, liability or
expense, including taxes (other than taxes based on the income of the Guarantee
Trustee) incurred without negligence or bad faith on its part, arising out of or
in connection with the acceptance or administration of the trust or trusts
hereunder, including the costs and expenses (including reasonable legal fees and
expenses) of defending itself against, or investigating, any claim or liability
in connection with the exercise or performance of any of its powers or duties
hereunder. The obligation to indemnify as set forth in this Section 8.2 shall
survive the termination of this Preferred Securities Guarantee. The provisions
of this Section shall survive the termination of the Guarantee Agreement.
ARTICLE IX
MISCELLANEOUS
SECTION 9.1 SUCCESSORS AND ASSIGNS.
All guarantees and agreements contained in this Preferred Securities
Guarantee shall bind the successors, assigns, receivers, trustees and
representatives of the Guarantor and shall inure to the benefit of the Holders
of the Preferred Securities then outstanding, except in connection with a
consolidation, merger or sale involving the Guarantor that is permitted under
Article XII of the Indenture and pursuant to which the assignee agrees in
writing to perform the Guarantees obligations hereunder, and any purported
assignment that is not in accordance with these provisions shall be void.
SECTION 9.2 AMENDMENTS.
Except with respect to any changes that do not materially adversely
affect the rights of Holders (in which case no consent of Holders will be
required), this Preferred Securities Guarantee may only be amended with the
prior approval of the Holders of at least a Majority in liquidation amount of
the Preferred Securities. The provisions of Article VI of the Trust Agreement
with respect to meetings of Holders of the Preferred Securities apply to the
giving of such approval.
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<PAGE>
SECTION 9.3 NOTICES.
All notices provided for in this Preferred Securities Guarantee shall
be in writing, duly signed by the party giving such notice, and shall be
delivered, telecopied or mailed by first-class mail, as follows:
(a) If given to the Preferred Guarantee Trustee, at the Preferred
Guarantee Trustee's mailing address set forth below (or such other address as
the Preferred Guarantee Trustee may give notice of to the Holders of the
Preferred Securities):
The Bank of New York
101 Barclay Street
Floor 21 West
New York, New York 10286
Facsimile No. (212) 815-5915
Attention: Corporate Trust Trustee Administration
(b) If given to the Guarantor, at the Guarantor's mailing address set
forth below (or such other address as the Guarantor may give notice of to the
Holders of the Preferred Securities):
American Bancorporation
1025 Main Street, Suite 800
Wheeling, WV 26003
Facsimile No. (304) 233-2730
Attention: Jeremy C. McCamic, Chairman of the Board and
Chief Executive Officer
(c) If given to any Holder of Preferred Securities, at the address set
forth on the books and records of the Trust.
All such notices shall be deemed to have been given when received in
person, telecopied with receipt confirmed, or mailed by first class mail,
postage prepaid except that if a notice or other document is refused delivery or
cannot be delivered because of a changed address of which no notice was given,
such notice or other document shall be deemed to have been delivered on the date
of such refusal or inability to deliver.
SECTION 9.4 BENEFIT.
This Preferred Securities Guarantee is solely for the benefit of the
Holders of the Preferred Securities and, subject to Section 3.1(a), is not
separately transferable from the Preferred Securities.
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<PAGE>
SECTION 9.5 GOVERNING LAW.
THIS PREFERRED SECURITIES GUARANTEE SHALL BE GOVERNED BY, AND CONSTRUED
AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT
REGARD TO THE CONFLICT OF LAW PRINCIPLES THEREOF.
This Preferred Securities Guarantee is executed as of the day and year
first above written.
AMERICAN BANCORPORATION, AS
GUARANTOR
By:
------------------------------------
Name: Jeremy C. McCamic
Title: Chairman of the Board and
Chief Executive Officer
THE BANK OF NEW YORK, AS
PREFERRED GUARANTEE TRUSTEE
By:
-------------------------------
Name:
-------------------------------
Title:
-------------------------------
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EXHIBIT 5.1
-----------
LAW OFFICES
MALONEY & KNOX
5225 Wisconsin Ave., NW, Suite 316
Washington, D.C. 20015-2014
(202) 293-1414 (202) 293-1702 fax
April 8, 1998
Board of Directors
American Bancorporation
1025 Main Street, Suite 800
Wheeling, WV 26003
Re: Registration Statement on Form S-2
Dear Board Members:
In connection with the registration under the Securities Act of 1933, as
amended (the "Act"), of up to $11,500,000 aggregate principal amount of Junior
Subordinated Deferrable Interest Debentures (the "Junior Subordinated
Debentures") of American Bancorporation, an Ohio corporation (the
"Corporation"), up to $11,500,000 aggregate liquidation amount of Cumulative
Trust Preferred Securities (the "Trust Preferred Securities") of American
Bancorporation Capital Trust I, a business trust created under the laws of the
State of Delaware (the "Issuer"), and the Guarantee.,with respect to the Trust
Preferred Securities (the "Guarantee") to be executed and delivered by the
Corporation for the benefit of the holders from time to time of the Trust
Preferred Securities, we, as your counsel, have examined such corporate records,
certificates and other documents, and such questions of law, as we have
considered necessary or appropriate for the purposes of this opinion.
Upon the basis of such examination, we advise you that, when:
(i) the Registration Statement relating to the Junior Subordinated
Debentures, the Trust Preferred Securities and the Guarantee has become
effective under the Act;
(ii) the Guarantee Agreement relating to the Guarantee with respect to
the Trust Preferred Securities of the Issuer has been duly executed and
delivered;
(iii) the Junior Subordinated Debentures have been duly executed and
authenticated in accordance with the Indenture and issued and delivered as
contemplated in the Registration Statement; and
(iv) the Trust Preferred Securities have been duly executed in
accordance with the Amended and Restated Trust Agreement of the Issuer and
issued and delivered as contemplated in the Registration Statement,
<PAGE>
the Junior Subordinated Debentures and the Guarantee relating to the Trust
Preferred Securities of the Issuer will constitute valid and legally binding
obligations of the Corporation, subject to bankruptcy, insolvency, fraudulent
transfer, reorganization, moratorium and similar laws of general applicability
relating to or affecting creditors' rights and to general equity principles.
We understand that you have received an opinion regarding the Trust
Preferred Securities from Richards, Layton & Finger, P.A., special Delaware
counsel for the Corporation and the Issuer. We are expressing no opinion with
respect to the matters contained in such opinion.
Also, we have relied as to certain matters on information obtained from
public officials, officers of the Corporation and other sources believed by us
to be responsible.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and to the references to us under the heading "Validity
of Securities" in the Prospectus. In giving such consent, we do not thereby
admit that we are in the category of persons whose comment is required under
Section 7 of the Act.
Very truly yours,
MALONEY & KNOX
By: /s/ Barry C. Maloney
----------------------------------
Barry C. Maloney
EXHIBIT 5.2
-----------
[Letterhead of Richards, Layton & Finger]
April 8, 1998
American Bancorporation Capital Trust I
c/o American Bancorporation
1025 Main Street, Suite 800
Wheeling, West Virginia 26003
Re: American Bancorporation Capital Trust I
Ladies and Gentlemen:
We have acted as special Delaware counsel for American Bancorporation,
an Ohio corporation (the "Company"), and American Bancorporation Capital Trust
I, a Delaware business trust (the "Trust"), in connection with the matters set
forth herein. At your request, this opinion is being furnished to you.
For purposes of giving the opinions hereinafter set forth, our
examination of documents has been limited to the examination of originals or
copies of the following:
(a) The Certificate of Trust of the Trust, dated as of March 11, 1998
(the "Certificate"), as filed in the office of the Secretary of State of the
State of Delaware (the "Secretary of State") on March 11, 1998;
(b) The Trust Agreement of the Trust, dated as of March 11, 1998, among
the Company and the trustees of the Trust named therein;
(c) The Registration Statement (the "Registration Statement") on Form
S-2, including a preliminary prospectus (the "Prospectus"), relating to the ___%
Cumulative Trust Preferred Securities of the Trust representing preferred
undivided beneficial interests in the assets of the Trust (each, a "Preferred
Security" and collectively, the "Preferred Securities"), as proposed to be filed
by the Company and the Trust with the Securities and Exchange Commission on or
about April 8, 1998;
(d) A form of Amended and Restated Trust Agreement of the Trust, to be
entered into among the Company, as depositor, the trustees of the Trust named
therein, and the holders, from time to time, of undivided beneficial interests
in the assets of the Trust (including Exhibits A,
<PAGE>
American Bancorporation Capital Trust I
April 8, 1998
Page 2
C and E thereto) (the "Trust Agreement"), attached as an exhibit to the
Registration Statement; and
(e) A Certificate of Good Standing for the Trust, dated April 8, 1998,
obtained from the Secretary of State.
Initially capitalized terms used herein and not otherwise defined are
used as defined in the Trust Agreement.
For purposes of this opinion, we have not reviewed any documents other
than the documents listed in paragraphs (a) through (e) above. In particular, we
have not reviewed any document (other than the documents listed in paragraphs
(a) through (e) above) that is referred to in or incorporated by reference into
the documents reviewed by us. We have assumed that there exists no provision in
any document that we have not reviewed that is inconsistent with the opinions
stated herein. We have conducted no independent factual investigation of our own
but rather have relied solely upon the foregoing documents, the statements and
information set forth therein and the additional matters recited or assumed
herein, all of which we have assumed to be true, complete and accurate in all
material respects.
With respect to all documents examined by us, we have assumed (i) the
authenticity of all documents submitted to us as authentic originals, (ii) the
conformity with the originals of all documents submitted to us as copies or
forms, and (iii) the genuineness of all signatures.
For purposes of this opinion, we have assumed (i) that the Trust
Agreement and the Certificate are in full force and effect and have not been
amended, (ii) except to the extent provided in paragraph 1 below, the due
creation or due organization or due formation, as the case may be, and valid
existence in good standing of each party to the documents examined by us under
the laws of the jurisdiction governing its creation, organization or formation,
(iii) the legal capacity of natural persons who are parties to the documents
examined by us, (iv) that each of the parties to the documents examined by us
has the power and authority to execute and deliver, and to perform its
obligations under, such documents, (v) the due authorization, execution and
delivery by all parties thereto of all documents examined by us, (vi) the
receipt by each Person to whom a Preferred Security is to be issued by the Trust
(collectively, the "Preferred Security Holders") of a Preferred Securities
Certificate for such Preferred Security and the payment for the Preferred
Security acquired by it, in accordance with the Trust Agreement and the
Registration Statement, and (vii) that the Preferred Securities are issued and
sold to the Preferred Security Holders in accordance with the Trust Agreement
and the Registration Statement. We have not participated in the preparation of
the Registration Statement and assume no responsibility for its contents.
This opinion is limited to the laws of the State of Delaware (excluding
the securities laws of the State of Delaware), and we have not considered and
express no opinion on the laws of any
<PAGE>
American Bancorporation Capital Trust I
April 8, 1998
Page 3
other jurisdiction, including federal laws and rules and regulations relating
thereto. Our opinions are rendered only with respect to Delaware laws and rules,
regulations and orders thereunder that are currently in effect.
Based upon the foregoing, and upon our examination of such questions of
law and statutes of the State of Delaware as we have considered necessary or
appropriate, and subject to the assumptions, qualifications, limitations and
exception set forth herein, we are of the opinion that:
1. The Trust has been duly created and is validly existing in good
standing as a business trust under the Delaware Business Trust Act.
2. The Preferred Securities will represent valid and, subject to the
qualifications set forth in paragraph 3 below, fully paid and nonassessable
undivided beneficial interests in the assets of the Trust.
3. The Preferred Security Holders, as beneficial owners of the Trust,
will be entitled to the same limitation of personal liability extended to
stockholders of private corporations for profit organized under the General
Corporation Law of the State of Delaware. We note that the Preferred Security
Holders may be obligated to make payments as set forth in the Trust Agreement.
We consent to the filing of this opinion with the Securities and
Exchange Commission as an exhibit to the Registration Statement. In addition, we
hereby consent to the use of our name under the heading "Validity of Securities"
in the Prospectus. In giving the foregoing consents, we do not thereby admit
that we come within the category of Persons whose consent is required under
Section 7 of the Securities Act of 1933, as amended, or the rules and
regulations of the Securities and Exchange Commission thereunder. Except as
stated above, without our prior written consent, this opinion may not be
furnished or quoted to, or relied upon by, any other Person for any purpose.
Very truly yours,
/s/ Richards, Layton & Finger, P.A.
BJK/BJ
EXHIBIT 8
---------
LAW OFFICES
MALONEY & KNOX
5225 Wisconsin Ave., NW, Suite 316
Washington, D.C. 20015-2014
(202) 293-1414 (202) 293-1702 fax
April 8, 1998
Board of Directors
American Bancorporation
1025 Main Street, Suite 800
Wheeling, WV 26003
Re: Registration Statement on Form S-2
Dear Board Members:
As special federal tax counsel to American Bancorporation Financial
Capital Trust I (the "Issuer") and American Bancorporation in connection with
the issuance by the Issuer of up to $12,650,000 of its Cumulative Trust
Preferred Securities pursuant to the prospectus (the "Prospectus") contained in
the Registration Statement, and assuming the operative documents described in
the Prospectus will be performed in accordance with the terms described therein,
we hereby confirm to you our opinion as set forth under the heading "Certain
Federal Income Tax Consequences" in the Prospectus, subject to the limitations
set forth therein.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and to the references to us under the heading "Certain
Federal Income Tax Consequences" in the Prospectus. In giving such consent, we
do not thereby admit that we are in the category of persons whose consent is
required under Section 7 of the Act.
Very truly yours,
MALONEY & KNOX
By: /s/ Barry C. Maloney
-----------------------
Barry C. Maloney
EXHIBIT 12
COMPUTATION OF CONSOLIDATED RATIO OF EARNINGS TO FIXED CHARGES
(Including Interest on Deposits)
The Company's ratios of earnings to fixed charges (including interest
on deposits) for the periods indicated were as follows:
<TABLE>
<CAPTION>
Year ended December 31,
---------------------------------------------------------------------------------
1997 1996 1995 1994 1993
---- ---- ---- ---- ----
(Dollars in thousands)
<S> <C> <C> <C> <C> <C>
Net income before income taxes................... $ 7,086 $ 5,768 $ 4,810 $ 2,578 $ 2,769
======= ======= ======= ======= =======
Fixed charges:
Interest expense................................. 18,278 13,802 11,171 7,189 8,009
------ ------ ------ ----- -----
Total fixed charges........................... $18,278 $13,802 $11,171 $7,189 $8,009
======= ======= ======= ====== ======
Earnings (for ratio calculation)................. $25,364 $19,570 $15,981 $ 9,767 $10,778
======= ======= ======= ======= =======
Ratio of earnings to fixed charges............... 1.39x 1.42x 1.43x 1.36x 1.35x
</TABLE>
COMPUTATION OF CONSOLIDATED RATIO OF EARNINGS TO FIXED CHARGES
(Excluding Interest on Deposits)
The Company's ratios of earnings to fixed charges (excluding interest
on deposits) for the periods indicated were as follows:
<TABLE>
<CAPTION>
Year ended December 31,
---------------------------------------------------------------------------------
1997 1996 1995 1994 1993
---- ---- ---- ---- ----
(Dollars in thousands)
<S> <C> <C> <C> <C> <C>
Net income before income taxes................... $ 7,086 $ 5,768 $ 4,810 $ 2,578 $ 2,769
======= ======= ======= ======= =======
Fixed charges:
Interest on borrowed funds....................... 5,094 2,871 1,373 159 64
------- ------- ------- -------- ---------
Total fixed charges........................... $ 5,094 $ 2,871 $ 1,373 $ 159 $ 64
======= ======= ======= ======== ========
Earnings (for ratio calculation)................. $12,180 $ 8,639 $6,183 $ 2,737 $ 2,833
======= ======= ====== ======= =======
Ratio of earnings to fixed charges............... 2.39x 3.01x 4.50x 17.21x 44.27x
</TABLE>
For purposes of computing the consolidated ratio of earnings to fixed
charges, "earnings" represent net income before extraordinary items and
cumulative effect of changes in accounting principles plus applicable income
taxes and fixed charges. Fixed charges, excluding interest on deposits, include
gross interest expense (other than on deposits). Fixed charges, including gross
interest on deposits, include all interest expense. No portion of net rental
expense was deemed to be equivalent to interest on debt for purposes of
calculating fixed charges.
EXHIBIT 23.1
CONSENT
The Board of Directors
American Bancorporation:
We consent to the use of our report dated March 26, 1998, included in the 1997
Annual Report to shareholders of the Company incorporated by reference in the
Annual Report on Form 10-K incorporated herein by reference and to the reference
to our firm under the heading "Experts" in the Prospectus and Registration
Statement. Our report refers to a change in accounting for mortgage servicing
rights as of January 1, 1996.
/s/ KPMG Peat Marwick LLP
-------------------------
KPMG Peat Marwick LLP
Pittsburgh, Pennsylvania
April 8, 1998
EXHIBIT 24
POWER OF ATTORNEY
We, the undersigned directors and officers of American Bancorporation
hereby severally constitute and appoint Jeremy C. McCamic and Brent E. Richmond,
or either of them, our true and lawful attorneys and agents, to do any and all
things and to execute any and all instruments which said attorneys and agents
may deem necessary or advisable to enable American Bancorporation to comply with
all state securities laws and the Securities Act of 1933, as amended, and any
rules, regulations and requirements of the Securities and Exchange Commission
and the state securities commissions in connection with the registering of
$12,650,000 in Trust Preferred Securities of American Bancorporation Capital
Trust I and $12,650,000 Junior Subordinated Deferred Interest Debentures of
American Bancorporation and Guarantees with respect to the Trust Preferred
Securities, including specifically but not limiting the generality of the
foregoing, the power and authority to sign the name of the undersigned directors
and officers in the capacities listed below to the filings with the various
state securities commissions, the National Association of Securities Dealers,
and the Securities and Exchange Commission Registration Statement on Form S-2
(or other applicable form) filed for such registration, and any and all
amendments (including post-effective amendments) and all supplements thereto.
<TABLE>
<CAPTION>
<S> <C> <C>
Signature Title Date
- --------- ----- ----
/s/ Jeremy C. McCamic
- ------------------------ Chairman of the Board & March 17, 1998
Jeremy C. McCamic Chief Executive Officer
/s/ Jolyon W. McCamic
- ------------------------ Vice Chairman of the Board March 17, 1998
Jolyon W. McCamic
/s/ Paul W. Donahie
- ------------------------ President & Director March 17, 1998
Paul W. Donahie
/s/ Brent E. Richmond
- ------------------------ Executive Vice President, March 17, 1998
Brent E. Richmond Secretary, Treasurer & CFO
/s/ Jay T. McCamic
- ------------------------ Director March 17, 1998
Jay T. McCamic
/s/ Jack O. Cartner
- ------------------------ Director March 17, 1998
Jack O. Cartner
/s/ Abigail M. Feinknopf
- ------------------------ Director March 17, 1998
Abigail M. Feinknopf
</TABLE>
EXHIBIT 25.1
================================================================================
FORM T-1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF A
CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE
ELIGIBILITY OF A TRUSTEE PURSUANT TO
SECTION 305(b)(2) |__|
-------------------
THE BANK OF NEW YORK
(Exact name of trustee as specified in its charter)
New York 13-5160382
(State of incorporation (I.R.S. employer
if not a U.S. national bank) identification no.)
48 Wall Street, New York, N.Y. 10286
(Address of principal executive offices) (Zip code)
----------------------
AMERICAN BANCORPORATION
(Exact name of obligor as specified in its charter)
Ohio 31-0724349
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification no.)
1025 Main Street, Suite 800
Wheeling, West Virginia 26003
(Address of principal executive offices) (Zip code)
----------------------
Junior Subordinated Deferrable
Interest Debentures
(Title of the indenture securities)
================================================================================
<PAGE>
1. GENERAL INFORMATION. FURNISH THE FOLLOWING INFORMATION AS TO THE TRUSTEE:
(A) NAME AND ADDRESS OF EACH EXAMINING OR SUPERVISING AUTHORITY TO WHICH
IT IS SUBJECT.
- --------------------------------------------------------------------------------
Name Address
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
<S> <C>
Superintendent of Banks of the State of 2 Rector Street, New York,
New York N.Y. 10006, and Albany, N.Y. 12203
Federal Reserve Bank of New York 33 Liberty Plaza, New York,
N.Y. 10045
Federal Deposit Insurance Corporation Washington, D.C. 20429
New York Clearing House Association New York, New York 10005
(B) WHETHER IT IS AUTHORIZED TO EXERCISE CORPORATE TRUST POWERS.
Yes.
</TABLE>
2. AFFILIATIONS WITH OBLIGOR.
IF THE OBLIGOR IS AN AFFILIATE OF THE TRUSTEE, DESCRIBE EACH SUCH
AFFILIATION.
None.
16. LIST OF EXHIBITS.
EXHIBITS IDENTIFIED IN PARENTHESES BELOW, ON FILE WITH THE COMMISSION, ARE
INCORPORATED HEREIN BY REFERENCE AS AN EXHIBIT HERETO, PURSUANT TO RULE
7A-29 UNDER THE TRUST INDENTURE ACT OF 1939 (THE "ACT") AND 17 C.F.R.
229.10(D).
1. A copy of the Organization Certificate of The Bank of New York
(formerly Irving Trust Company) as now in effect, which contains the
authority to commence business and a grant of powers to exercise
corporate trust powers. (Exhibit 1 to Amendment No. 1 to Form T-1
filed with Registration Statement No. 33-6215, Exhibits 1a and 1b to
Form T-1 filed with Registration Statement No. 33-21672 and Exhibit 1
to Form T-1 filed with Registration Statement No. 33-29637.)
4. A copy of the existing By-laws of the Trustee. (Exhibit 4 to Form T-1
filed with Registration Statement No. 33-31019.)
-2-
<PAGE>
6. The consent of the Trustee required by Section 321(b) of the Act.
(Exhibit 6 to Form T-1 filed with Registration Statement No.
33-44051.)
7. A copy of the latest report of condition of the Trustee published
pursuant to law or to the requirements of its supervising or examining
authority.
-3-
<PAGE>
SIGNATURE
Pursuant to the requirements of the Act, the Trustee, The Bank of New
York, a corporation organized and existing under the laws of the State of New
York, has duly caused this statement of eligibility to be signed on its behalf
by the undersigned, thereunto duly authorized, all in The City of New York, and
State of New York, on the 16th day of March, 1998.
THE BANK OF NEW YORK
By: /s/THOMAS B. ZAKRZEWSKI
--------------------------
Name: THOMAS B. ZAKRZEWSKI
Title: ASSISTANT VICE PRESIDENT
-4-
<PAGE>
EXHIBIT 7
---------
CONSOLIDATED REPORT OF CONDITION OF
THE BANK OF NEW YORK
OF 48 WALL STREET, NEW YORK, N.Y. 10286
AND FOREIGN AND DOMESTIC SUBSIDIARIES.
A MEMBER OF THE FEDERAL RESERVE SYSTEM, AT THE CLOSE OF BUSINESS SEPTEMBER 30,
1997, PUBLISHED IN ACCORDANCE WITH A CALL MADE BY THE FEDERAL RESERVE BANK OF
THIS DISTRICT PURSUANT TO THE PROVISIONS OF THE FEDERAL RESERVE ACT.
Dollar amounts
ASSETS in Thousands
Cash and balances due from depos-
itory institutions:
Noninterest-bearing balances and
currency and coin................................... $ 5,004,638
Interest-bearing balances.............................. 1,271,514
Securities:
Held-to-maturity securities............................ 1,105,782
Available-for-sale securities ......................... 3,164,271
Federal funds sold and Securities
purchased under agreements to
resell................................................. 5,723,829
Loans and lease financing
receivables:
Loans and leases net of unearned income................ 34,916,196
LESS: Allowance for loan and lease losses.............. 581,177
LESS: Allocated transfer risk reserve.................. 429
Loans and leases, net of unearned income, allowance,
and reserve......................................... 34,334,590
Assets held in trading accounts........................ 2,035,284
Premises and fixed assets (including capitalized
leases)............................................. 671,664
Other real estate owned ..................................... 13,306
Investments in unconsolidated subsidiaries and associated
companies .......................................... 210,685
Customers liability toi the bank on acceptances
outstanding ........................................ 1,463,446
Intangible assets ........................................... 753,190
Other assets ................................................ 1,784,795
-----------
Total assets ................................................ $57,536,995
===========
LIABILITIES
Deposits:
In domestic offices .................................... 27,270,824
Noninterest-bearing..................................... 12,160,977
Interest-bearing ....................................... 15,109,847
In foreign offices. Edge and Agreement
subsidiaries and IBFs .................................. 14,687,806
Noninterest-bearing .................................... 657,479
Interest-bearing ....................................... 14,030,327
Federal funds purchaed and Securities sold under agreements to
repurchase ............................................. 1,946,099
Demand noted issued to the U.S. Treasury .................... 283,793
Trading liabilities ......................................... 1,553,539
Other borrowed money:
With remaining maturity of one year or less ............ 0
With remaining maturity of more than three years ............ 45,664
Earns liability on acceptance executed
and outstanding......................................... 1,473,588
Subordinated notes and debentures ........................... 1,018,940
Other liabilities ........................................... 2,193,031
---------
Total liabilities ........................................... 52,718,298
----------
EQUITY CAPITAL
Common Stock ................................................ 1,135,284
Surplus ..................................................... 731,319
Undivided profits and capital reserves ...................... 2,943,008
Net unrealized holding gains (losses) on available-for-sale
securities ............................................. 25,428
Cumulative foreign currency translation adjustments ......... (16,342)
----------
Total equity capital ........................................ 4,818,697
----------
Total liabilities and equity capital ........................ $57,536,995
===========
<PAGE>
I, Robert E. Kerlman, Senior Vice President and Comptroller of the
above-named bank do hereby declare that this Report of Condition has been
prepared on conformance with the instructions issued by the Board of Governors
of the Federal Reserve System and is true to the best of my knowledge and
belief.
Robert E. Kerlman
We, the undersigned directors attest to the correctness of this Report
Condition and declare that it has been examined by us and to the best of our
knowledge and belief has been prepared in conformance with the instructions
issued by the Board of Governors of the Federal Reserve System and is true and
correct.
J Carter Bacot
Thomas A. Benyi Directors
Alan R. Griffith
- --------------------------------------------------------------------------------
================================================================================
EXHIBIT 25.2
FORM T-1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF A
CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE
ELIGIBILITY OF A TRUSTEE PURSUANT TO
SECTION 305(b)(2) |__|
THE BANK OF NEW YORK
(Exact name of trustee as specified in its charter)
New York 13-5160382
(State of incorporation (I.R.S. employer
if not a U.S. national bank) identification no.)
48 Wall Street, New York, N.Y. 10286
(Address of principal executive offices) (Zip code)
----------------------
AMERICAN BANCORPORATION CAPITAL TRUST I
(Exact name of obligor as specified in its charter)
Delaware 55-6133241
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification no.)
1025 Main Street, Suite 800
Wheeling, West Virginia 26003
(Address of principal executive offices) (Zip code)
----------------------
Trust Preferred Securities
(Title of the indenture securities)
================================================================================
<PAGE>
1. GENERAL INFORMATION. FURNISH THE FOLLOWING INFORMATION AS TO THE TRUSTEE:
(A) NAME AND ADDRESS OF EACH EXAMINING OR SUPERVISING AUTHORITY TO WHICH
IT IS SUBJECT.
- --------------------------------------------------------------------------------
Name Address
- --------------------------------------------------------------------------------
Superintendent of Banks of the State of 2 Rector Street, New York,
New York N.Y. 10006, and Albany,
N.Y. 12203
Federal Reserve Bank of New York 33 Liberty Plaza, New York,
N.Y. 10045
Federal Deposit Insurance Corporation Washington, D.C. 20429
New York Clearing House Association New York, New York 10005
(B) WHETHER IT IS AUTHORIZED TO EXERCISE CORPORATE TRUST POWERS.
Yes.
2. AFFILIATIONS WITH OBLIGOR.
IF THE OBLIGOR IS AN AFFILIATE OF THE TRUSTEE, DESCRIBE EACH SUCH
AFFILIATION.
None.
16. LIST OF EXHIBITS.
EXHIBITS IDENTIFIED IN PARENTHESES BELOW, ON FILE WITH THE COMMISSION,
ARE INCORPORATED HEREIN BY REFERENCE AS AN EXHIBIT HERETO, PURSUANT TO
RULE 7A-29 UNDER THE TRUST INDENTURE ACT OF 1939 (THE "ACT") AND 17
C.F.R. 229.10(D).
1. A copy of the Organization Certificate of The Bank of New York
(formerly Irving Trust Company) as now in effect, which
contains the authority to commence business and a grant of
powers to exercise corporate trust powers. (Exhibit 1 to
Amendment No. 1 to Form T-1 filed with Registration Statement
No. 33-6215, Exhibits 1a and 1b to Form T-1 filed with
Registration Statement No. 33-21672 and Exhibit 1 to Form T-1
filed with Registration Statement No. 33-29637.)
4. A copy of the existing By-laws of the Trustee. (Exhibit 4 to
Form T-1 filed with Registration Statement No. 33-31019.)
-2-
<PAGE>
6. The consent of the Trustee required by Section 321(b) of the
Act. (Exhibit 6 to Form T-1 filed with Registration Statement
No. 33-44051.)
7. A copy of the latest report of condition of the Trustee
published pursuant to law or to the requirements of its
supervising or examining authority.
-3-
<PAGE>
SIGNATURE
Pursuant to the requirements of the Act, the Trustee, The Bank of New
York, a corporation organized and existing under the laws of the State of New
York, has duly caused this statement of eligibility to be signed on its behalf
by the undersigned, thereunto duly authorized, all in The City of New York, and
State of New York, on the 16th day of March, 1998.
THE BANK OF NEW YORK
By: /s/THOMAS B. ZAKRZEWSKI
----------------------------------
Name: THOMAS B. ZAKRZEWSKI
Title: ASSISTANT VICE PRESIDENT
<PAGE>
EXHIBIT 7
---------
CONSOLIDATED REPORT OF CONDITION OF
THE BANK OF NEW YORK
OF 48 WALL STREET, NEW YORK, N.Y. 10286
AND FOREIGN AND DOMESTIC SUBSIDIARIES.
A MEMBER OF THE FEDERAL RESERVE SYSTEM, AT THE CLOSE OF BUSINESS SEPTEMBER 30,
1997, PUBLISHED IN ACCORDANCE WITH A CALL MADE BY THE FEDERAL RESERVE BANK OF
THIS DISTRICT PURSUANT TO THE PROVISIONS OF THE FEDERAL RESERVE ACT.
Dollar amounts
ASSETS in Thousands
Cash and balances due from depos-
itory institutions:
Noninterest-bearing balances and
currency and coin................................... $ 5,004,638
Interest-bearing balances.............................. 1,271,514
Securities:
Held-to-maturity securities............................ 1,105,782
Available-for-sale securities ......................... 3,164,271
Federal funds sold and Securities
purchased under agreements to
resell................................................. 5,723,829
Loans and lease financing
receivables:
Loans and leases net of unearned income................ 34,916,196
LESS: Allowance for loan and lease losses.............. 581,177
LESS: Allocated transfer risk reserve.................. 429
Loans and leases, net of unearned income, allowance,
and reserve......................................... 34,334,590
Assets held in trading accounts........................ 2,035,284
Premises and fixed assets (including capitalized
leases)............................................. 671,664
Other real estate owned ..................................... 13,306
Investments in unconsolidated subsidiaries and associated
companies .......................................... 210,685
Customers liability toi the bank on acceptances
outstanding ........................................ 1,463,446
Intangible assets ........................................... 753,190
Other assets ................................................ 1,784,795
-----------
Total assets ................................................ $57,536,995
===========
LIABILITIES
Deposits:
In domestic offices .................................... 27,270,824
Noninterest-bearing..................................... 12,160,977
Interest-bearing ....................................... 15,109,847
In foreign offices. Edge and Agreement
subsidiaries and IBFs .................................. 14,687,806
Noninterest-bearing .................................... 657,479
Interest-bearing ....................................... 14,030,327
Federal funds purchaed and Securities sold under agreements to
repurchase ............................................. 1,946,099
Demand noted issued to the U.S. Treasury .................... 283,793
Trading liabilities ......................................... 1,553,539
Other borrowed money:
With remaining maturity of one year or less ............ 0
With remaining maturity of more than three years ............ 45,664
Earns liability on acceptance executed
and outstanding......................................... 1,473,588
Subordinated notes and debentures ........................... 1,018,940
Other liabilities ........................................... 2,193,031
---------
Total liabilities ........................................... 52,718,298
----------
EQUITY CAPITAL
Common Stock ................................................ 1,135,284
Surplus ..................................................... 731,319
Undivided profits and capital reserves ...................... 2,943,008
Net unrealized holding gains (losses) on available-for-sale
securities ............................................. 25,428
Cumulative foreign currency translation adjustments ......... (16,342)
----------
Total equity capital ........................................ 4,818,697
----------
Total liabilities and equity capital ........................ $57,536,995
===========
<PAGE>
I, Robert E. Kerlman, Senior Vice President and Comptroller of the
above-named bank do hereby declare that this Report of Condition has been
prepared on conformance with the instructions issued by the Board of Governors
of the Federal Reserve System and is true to the best of my knowledge and
belief.
Robert E. Kerlman
We, the undersigned directors attest to the correctness of this Report
Condition and declare that it has been examined by us and to the best of our
knowledge and belief has been prepared in conformance with the instructions
issued by the Board of Governors of the Federal Reserve System and is true and
correct.
J Carter Bacot
Thomas A. Benyi Directors
Alan R. Griffith
- --------------------------------------------------------------------------------
================================================================================
EXHIBIT 25.3
FORM T-1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF A
CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE
ELIGIBILITY OF A TRUSTEE PURSUANT TO
SECTION 305(b)(2) |__|
THE BANK OF NEW YORK
(Exact name of trustee as specified in its charter)
New York 13-5160382
(State of incorporation (I.R.S. employer
if not a U.S. national bank) identification no.)
48 Wall Street, New York, N.Y. 10286
(Address of principal executive offices) (Zip code)
----------------------
AMERICAN BANCORPORATION
(Exact name of obligor as specified in its charter)
Ohio 31-0724349
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification no.)
1025 Main Street, Suite 800
Wheeling, West Virginia 26003
(Address of principal executive offices) (Zip code)
----------------------
Guarantee of Trust Preferred Securities of
American Bancorporation Capital Trust I
(Title of the indenture securities)
================================================================================
<PAGE>
1. GENERAL INFORMATION. FURNISH THE FOLLOWING INFORMATION AS TO THE TRUSTEE:
(A) NAME AND ADDRESS OF EACH EXAMINING OR SUPERVISING AUTHORITY TO WHICH
IT IS SUBJECT.
- --------------------------------------------------------------------------------
Name Address
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
<S> <C> <C>
Superintendent of Banks of the State of 2 Rector Street, New York,
New York N.Y. 10006, and Albany, N.Y. 12203
Federal Reserve Bank of New York 33 Liberty Plaza, New York,
N.Y. 10045
Federal Deposit Insurance Corporation Washington, D.C. 20429
New York Clearing House Association New York, New York 10005
(B) WHETHER IT IS AUTHORIZED TO EXERCISE CORPORATE TRUST POWERS.
Yes.
2. AFFILIATIONS WITH OBLIGOR.
IF THE OBLIGOR IS AN AFFILIATE OF THE TRUSTEE, DESCRIBE EACH SUCH
AFFILIATION.
None.
</TABLE>
16. LIST OF EXHIBITS.
EXHIBITS IDENTIFIED IN PARENTHESES BELOW, ON FILE WITH THE COMMISSION,
ARE INCORPORATED HEREIN BY REFERENCE AS AN EXHIBIT HERETO, PURSUANT TO
RULE 7A-29 UNDER THE TRUST INDENTURE ACT OF 1939 (THE "ACT") AND 17
C.F.R. 229.10(D).
1. A copy of the Organization Certificate of The Bank of New York
(formerly Irving Trust Company) as now in effect, which
contains the authority to commence business and a grant of
powers to exercise corporate trust powers. (Exhibit 1 to
Amendment No. 1 to Form T-1 filed with Registration Statement
No. 33-6215, Exhibits 1a and 1b to Form T-1 filed with
Registration Statement No. 33-21672 and Exhibit 1 to Form T-1
filed with Registration Statement No. 33-29637.)
4. A copy of the existing By-laws of the Trustee. (Exhibit 4 to
Form T-1 filed with Registration Statement No. 33-31019.)
-2-
<PAGE>
6. The consent of the Trustee required by Section 321(b) of the
Act. (Exhibit 6 to Form T-1 filed with Registration Statement
No. 33-44051.)
7. A copy of the latest report of condition of the Trustee
published pursuant to law or to the requirements of its
supervising or examining authority.
-3-
<PAGE>
SIGNATURE
Pursuant to the requirements of the Act, the Trustee, The Bank of New
York, a corporation organized and existing under the laws of the State of New
York, has duly caused this statement of eligibility to be signed on its behalf
by the undersigned, thereunto duly authorized, all in The City of New York, and
State of New York, on the 16th day of March, 1998.
THE BANK OF NEW YORK
By: /s/THOMAS B. ZAKRZEWSKI
-------------------------------
Name: THOMAS B. ZAKRZEWSKI
Title: ASSISTANT VICE PRESIDENT
<PAGE>
EXHIBIT 7
---------
CONSOLIDATED REPORT OF CONDITION OF
THE BANK OF NEW YORK
OF 48 WALL STREET, NEW YORK, N.Y. 10286
AND FOREIGN AND DOMESTIC SUBSIDIARIES.
A MEMBER OF THE FEDERAL RESERVE SYSTEM, AT THE CLOSE OF BUSINESS SEPTEMBER 30,
1997, PUBLISHED IN ACCORDANCE WITH A CALL MADE BY THE FEDERAL RESERVE BANK OF
THIS DISTRICT PURSUANT TO THE PROVISIONS OF THE FEDERAL RESERVE ACT.
Dollar amounts
ASSETS in Thousands
Cash and balances due from depos-
itory institutions:
Noninterest-bearing balances and
currency and coin................................... $ 5,004,638
Interest-bearing balances.............................. 1,271,514
Securities:
Held-to-maturity securities............................ 1,105,782
Available-for-sale securities ......................... 3,164,271
Federal funds sold and Securities
purchased under agreements to
resell................................................. 5,723,829
Loans and lease financing
receivables:
Loans and leases net of unearned income................ 34,916,196
LESS: Allowance for loan and lease losses.............. 581,177
LESS: Allocated transfer risk reserve.................. 429
Loans and leases, net of unearned income, allowance,
and reserve......................................... 34,334,590
Assets held in trading accounts........................ 2,035,284
Premises and fixed assets (including capitalized
leases)............................................. 671,664
Other real estate owned ..................................... 13,306
Investments in unconsolidated subsidiaries and associated
companies .......................................... 210,685
Customers liability toi the bank on acceptances
outstanding ........................................ 1,463,446
Intangible assets ........................................... 753,190
Other assets ................................................ 1,784,795
-----------
Total assets ................................................ $57,536,995
LIABILITIES
Deposits:
In domestic offices .................................... 27,270,824
Noninterest-bearing..................................... 12,160,977
Interest-bearing ....................................... 15,109,847
In foreign offices. Edge and Agreement
subsidiaries and IBFs .................................. 14,687,806
Noninterest-bearing .................................... 657,479
Interest-bearing ....................................... 14,030,327
Federal funds purchaed and Securities sold under agreements to
repurchase ............................................. 1,946,099
Demand noted issued to the U.S. Treasury .................... 283,793
Trading liabilities ......................................... 1,553,539
Other borrowed money:
With remaining maturity of one year or less ............ 0
With remaining maturity of more than three years ............ 45,664
Earns liability on acceptance executed
and outstanding......................................... 1,473,588
Subordinated notes and debentures ........................... 1,018,940
Other liabilities ........................................... 2,193,031
---------
Total liabilities ........................................... 52,718,298
----------
EQUITY CAPITAL
Common Stock ................................................ 1,135,284
Surplus ..................................................... 731,319
Undivided profits and capital reserves ...................... 2,943,008
Net unrealized holding gains (losses) on available-for-sale
securities ............................................. 25,428
Cumulative foreign currency translation adjustments ......... ( 16,342)
----------
Total equity capital ........................................ 4,818,697
----------
Total liabilities and equity capital ........................ $57,536,995
===========
<PAGE>
I, Robert E. Kerlman, Senior Vice President and Comptroller of the
above-named bank do hereby declare that this Report of Condition has been
prepared on conformance with the instructions issued by the Board of Governors
of the Federal Reserve System and is true to the best of my knowledge and
belief.
Robert E. Kerlman
We, the undersigned directors attest to the correctness of this Report
Condition and declare that it has been examined by us and to the best of our
knowledge and belief has been prepared in conformance with the instructions
issued by the Board of Governors of the Federal Reserve System and is true and
correct.
J Carter Bacot
Thomas A. Benyi Directors
Alan R. Griffith
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